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Ron Paul Set to Lead Federal Reserve Oversight Committee

November 5, 2010 - by Donny Shaw

Rep. Ron Paul [R, TX-14], the most popular member of Congress amongst OC users, is in line next session to take control of the Domestic and International Monetary Policy, Trade and Technology subcommittee, oversees the Federal Reserve, among other things. Paul is well known for being critical of the Fed, having recently authored a book titled “End the Fed” and sponsoring legislation session after session designed to accomplish just what the book title suggests. He has inspired a powerful, Tea Party-aligned grassroots movement around his ideas of abolishing the Fed and changing the fundamental structure of the U.S. monetary system. With the Fed right now at the center of efforts to get the economy back up and running, having Paul take over Fed oversight right now could really shake things up.

Paul recently spoke to Reuters about what he plans to do with his new position:

Paul is currently the top Republican on the House of Representatives subcommittee that oversees domestic monetary policy, and is likely to head the panel when Republicans take control of the chamber in January.

That could create a giant headache for the Fed, which earlier this year fended off an effort headed by Paul to open up its internal deliberations on interest rates and monetary easing to congressional scrutiny. […]

Paul said his subcommittee would also push to examine the country’s gold reserves and highlight the views of economists who believe that economic downturns are caused by bad monetary policy, not the vagaries of the free market.

Global organizations like the International Monetary Fund also will come under scrutiny, he said.

“Eventually we’re going to have monetary reform. I do not believe the dollar can be the reserve standard of the world,” said Paul, who has called for returning the United States to a currency backed by gold or silver.

Earlier this year when Congress was working on financial reform, they caved to the Obama Administration on Fed transparency at the last minute. Both the Senate and the House were on route to pass strong Fed audit language, similar to Paul’s “Audit the Fed” bill, that would have removed all restrictions on which Fed activities the Government Accountability Office can look at and allow full audits to happen regularly into the future. But Obama threatened to veto the whole bill if this language was added, so, led by Sen. Bernie Sanders [I, VT], they swapped it out for language that instead would allow a one-time audit of the Fed’s activities in the financial crisis and leave in place the GAO restrictions on future audits.

With Paul gaining new leadership powers, the battle between Congress and the Administration over Fed transparency and monetary system is definitely going to heat up again next year. The energy he has amassed around his causes, both in and out of Congress, could turn this into the populist fight of our time, with Ben Bernanke and the entrenched powers he is perceived to represent as a very vulnerable target.

Pictured is Ron Paul with his son, the Senator-elect Republican from Kentucky, Rand Paul.

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