Posted on 07/30/2009 6:55:11 AM PDT by BGHater
Federal Reserve Chairman Ben Bernanke is strongly opposing a proposal in Congress, which enjoys the support of over half of the U.S. House of Representatives, to audit the Fed.
During an appearance on PBS's NewsHour, which will be aired this week on local PBS stations, Bernanke said the proposed legislation would interfere with the central bank's independence. "I don't think the American people want Congress running monetary policy," he said. "And I think that's very very critical for people to understand." (See transcript below.)
This is an odd claim. If you read the bill (H.R.1207), it simply amends existing law to say "under regulations of the Comptroller General, the Comptroller General shall audit" the Federal Reserve Board and its member banks.
The Comptroller General is a Senate-confirmed official who's also the head of the Government Accountability Office (GAO), a legislative branch agency organized under the U.S. Congress. In other words, we're not talking about a political bomb-thrower, but a veteran civil servant tasked with important oversight responsibilities.
The argument for an audit has become stronger in the wake of the extraordinary and unprecedented steps the Federal Reserve has taken in response to the market turmoil that began two years ago. Among them: the Fed has printed hundreds of billions of dollars to purchase what are delicately called "troubled assets"; it has created mammoth Wall Street bailout funds with acronyms like CPFF and TALF; and it has done all of this without prior approval by the U.S. Congress.
As far back as 1977, the GAO was saying it needed the authority to conduct a full audit of the Fed. "We do not see how we can satisfactorily audit the Federal Reserve System without authority to examine the largest single category of financial transactions and assets (foreign currency purchases) that it has," its report to Congress said at the time.
If the Fed had stuck to its traditional role of setting interest rate targets and employing other monetary policy tools, it's unlikely this measure -- the Federal Reserve Transparency Act of 2009 -- would have drawn more than a modicum of public and congressional support today.
But because Bernanke and other Fed officials have been bailing out financial institutions, such as providing up to $30 billion to let JPMorgan buy Bear Stearns last year, and because the national monetary base has recently doubled, public interest in the topic has spiked.
Bernanke can thank (or blame) Rep. Ron Paul, the libertarian-leaning Texas Republican and longtime Fed critic, for focusing so much attention on this topic. Paul was the original author of the Audit-The-Fed bill, which can now claim 277 sponsors, up from 170 two months ago. It's been spurred along by concerns about the way the government is responding to what has become an unusually severe recession -- and public opinion turning against the Federal Reserve.
"Since its inception, the Federal Reserve has always operated in the shadows, without sufficient scrutiny or oversight of its operations," Paul said in a February 2009 speech announcing the bill. "While the conventional excuse is that this is intended to reduce the Fed's susceptibility to political pressures, the reality is that the Fed acts as a foil for the government. Whenever you question the Fed about the strength of the dollar, they will refer you to the Treasury, and vice versa. The Federal Reserve has, on the one hand, many of the privileges of government agencies, while retaining benefits of private organizations, such as being insulated from Freedom of Information Act requests."
Paul points out that although Federal Reserve has the authority to enter into agreements with foreign central banks and foreign governments, the GAO is prohibited from auditing or even reviewing any of those agreements. (Current law says the GAO may not audit "transactions for or with a foreign central bank, government of a foreign country, or nonprivate international financing organization.")
The 2008 presidential candidate has been a longtime Fed critic, and even an advocate of its abolishment, saying for years that if the central bank keeps interest rates too low, bubbles are likely to form. In 2002, for instance, Paul correctly predicted that government policies would create "a short-term boom in housing" while increasing "the likelihood of a painful crash in the housing market." This represents a minority view among economists -- see a CBSNews.com review of a recent book on the financial crisis with a foreword by Rep. Paul -- but one that has found more adherents recently.
Here's an excerpt from the transcript of the PBS exchange:
PBS' Jim Lehrer: There's an effort in Congress, and in the House in particular, to audit what the Federal Reserve does, particiularly in monetary policy. How do you feel about that?
Bernanke: So that bill, people don't fully understand what that bill is about. It sounds like, audit the Fed, it sounds like "Let's look at the books." That's what it sounds like. Congress already looks at our books. We have many different levels of auditors. The GAO, the General Accountability Office, which is supposed to be doing this audit, already looks at virtually all of our activities. And the ones it doesn't, our financial books, financial loans, and the ones it's not looking at, and where the taxpayer needs some assurance, we're willing to work with Congress to make sure the GAO gets the information it needs.
Bernanke: What people don't understand is that this bill would give the GAO, the GAO, the authority to audit monetary policy. And what does that mean? That means if the Federal Reserve decided a year from now that because of incipient inflation it was time to raise interest rates, that the Congress would say, 'Ah, the GAO's going to audit that decision. It's going to subpoena your materials. It's going to demand information from members of the FOMC. It's going to evaluate your decision. It's going to report to Congress.' I don't think that's consistent with independence. We are completely open to providing any information Congress wants to make sure we're using taxpayer money safely and soundly, that we're meeting all our responsibilities. I don't think the American people want Congress running monetary policy. And I think that's very very critical for people to understand.
PBS' Jim Lehrer: You think that's what it would end up doing?
Bernanke: Exactly, that's exactly what it would do. There's a provision in that law, which, currently, current law, which carves out monetary policy. It doesn't give Congress authority, GAO authority to audit it. That was put in in 1978, at a time when we had a lot of inflation, which you might remember. After that the Fed became more independent, brought inflation down. But now, that's exactly what it would do. If that carveout was eliminated, Congress would have the authority anytime to ask the GAO to come in, and audit, and look at, and evaluate the monetary policy decisions made by the Fed. That's not consistent with independence.
The new transparency contains 30% more opacity.
I received a phone call on this the other night to donate to fight this and they are sending me the information packet.
Bernanke et al will squeal and squeal.....prob redundant to post this, but.....
“Give me control of a nations money supply, and I care not who makes it’s laws.”
C R O O K S
Expose the crooks in government.
CBS? WOW!
Also, check out MSNBC:
MSNBC Exposes The Federal Reserve 7/24/09
http://www.youtube.com/watch?v=AcXcVrOhYKc
Ping
Well, of course Bernanke opposes this bill. With real “transparency”, Bernanke becomes just another civil servant, and not the Mafia Don whose ring gets kissed by all the world’s major financial institutions! Think that he wants to give that up? Of course not!
“already looks at *virtually* all of our activities”
What about the ones *virtually* doesn’t cover, Ben?
I can see why they want to stay *independent*. That way they don’t have to answer to the taxpayers.
...Ben could probably use a good hosing, his own damn self...
and you just know they don't want you to 'audit' these 'companies', because then they'd have to release where the profits go from these 'companies', and you really don't wanna know that, do you!
I don't want to know what I already know? The "profits" of the Fed are returned to the U.S. Govt. It's not much of a secret.
In other news, SeeBS aired a piece detailing how the Second Amendment was obsolete. PMSNBC aired a piece about how wonderful Comrade Obama's Healthcare plan will be. Should I fall for those pieces, too?
fall for whatever u like pal.
Well, there is the possibility that a lone decent reporter is on the loose.
Soory about my short reply earlier, but I really believe strongly that the transparency of the Federal Reserve is one of the most important issues of our generation.
Here's a link to the latest audits: http://federalreserve.gov/boarddocs/rptcongress/annual08/pdf/audits.pdf
The Fed is regularly audited per U.S. Law. But, I'm sure you knew that.
Since the House turns over every two years, this is a much bigger deal there. If you look at the Senate, the effort is being spearheaded by Bernie Sanders (Commie-VT) to little avail. If this bill ever makes it out of Barney Franks's committee in the House, it will only serve to give the House cover back home with the rubes. It will never go anywhere in the Senate and they know it.
I think the MSM deserves a skeptical eye 24/7.
H.R. 2176, a Bill to Amend the Accounting and Auditing Act of
1950 to Provide for the Audit of the Federal Reserve Board
Testiecny before the House Committee on Government operations:
commerce, Consumer and Monetary Affairs Subcommittee; by E. H.
Morse, Jr., Assistant Comptroller General.
March 2, 1977
“We do not see how we can satisfactorily audit the Federal
Reserve Sstem without authority to examine the largest single
category of financial transactions and assets that it has.
It is our understanding that the restriction in the
bill that we would not audit monetary policy deliberations
and open market transactions grows out of concern that our auditing would somehow undermine the independence of the
Federal Reserve System with respect to its moietary and credit
operations and damage the Nation’s monetary policyaking
system. Needless to say, as we have testified on previous
occasions, we do not concur in this view.”
http://archive.gao.gov/f1102a/100319.pdf
I doubt you already knew this. :D
I only recently learned it myself. It appears that while the Fed is audited, even the GAO itself agrees that the audit is not effective under the current restrictions.
Bernanke has repeatedly stated that he is willing to work with Congress and the GAO to get them the info they want. They don't seem to be interested in a compromise, even if they can get what they want. Why? I can only guess that the goal is to review monetary policy, and not just the transactions.
Congress obviously has the final word on this matter. I think a compromise could be reached that would not endanger the Fed's independence on monetary policy. Others will not be satisfied until a wooden stake is driven into the Fed, by whatever means possible.
Why am I concerned? I'll use Barney Frank as an example. Barney has told the banks that they will stop foreclosures now, or he will initiate legislation to stop them (e.g. Cramdown bill). This is exactly the danger with regard to monetary policy. We don't need blowhards like Barney threatening the Fed to buy so much debt...or else.
These bastards are redistributing the wealth of American taxpayers yet to be born, behind our backs. How long we gonna take this sh*t?
THIS is treason.
It’s the apropriate audit conducted under present law. If our legislature decides to change the law, then maybe they will allow an audit of other areas. The audits are performed each year according to the law on the books. Whether the law is changed or not, audits are being conducted of the Fed, FDIC and OCC accordingly.
Ok, 10Ring, thanks for the info, it’s same situation here in the UK.
Ha!
If this was the same ol’ audit they currently receive each year, the Federal Reserve wouldn’t be hemming and hawing like they are. They wouldn’t be hiring PR agents to fight this in Congress. Bernanke wouldn’t be squealing like a stuck pig in interviews if this was nothing new or special for them.
But what this bill, H.R. 1207, does, is give them a real audit. Not the watered-down and heavily-restricted one they get now thanks to Congress in 1978.
My take on the matter is that there IS information that would be helpful for Congressional oversight, but there is also a fine line between that and torpedoing monetary policy. Bernanke has offered to provide more information. Why not take him up on his offer? If he doesn't come through with the details, then HR 1207 is still waiting in the wings.
Unless, of course, the intent is not to audit, but to gain control of monetary policy. The last thing we need is Congress conducting monetary policy. They can't even run Cash for Clunkers.
Unless, of course, the intent is not to audit, but to gain control of monetary policy.
Are you familiar with Article I, Section 8 of the U.S. Constitution? I may not like the Congress, but actually doing what they are empowered to do is hardly some sinister power grab.
LOL! Looks like someone read my entire post. Yes, I'm aware of Congress' Constitutional authority. Hence, my jab that a body who could screw up Cash for Clunkers would not do a very good job on monetary policy. They should delegate -- which is exactly what Congress has done.
I may not like the Congress, but actually doing what they are empowered to do is hardly some sinister power grab.
Are you aware that Congress passed the Federal Reserve Act and that Congress has revised the Act several times since 1913? I would say that Congress is exercising its Constitutional authority just fine through the Federal Reserve Act. If enough congresscritters can be convinced of a better way (including having the Congress itself - which has never happened - conduct monetary policy), then we'll see a change. In the meantime the Federal Reserve System is the legislated authority on monetary policy in the U.S.A.
LOL! Looks like someone read my entire post. Yes, I'm aware of Congress' Constitutional authority. Hence, my jab that a body who could screw up Cash for Clunkers would not do a very good job on monetary policy. They should delegate -- which is exactly what Congress has done.
You suggest that the Congress can delegate their powers, but how certain is that? Would that mean that Congress can give the authority to provide and maintain a Navy to a private body? What about regulating commerce with foreign Nations? And what about the power to legislate itself? I have doubts.
However, that is not really the point here. Congress is not even trying to exercise its authority to revoke the Federal Reserve Act or any revision of it. If Congress has the power to delegate its Constitutional power to a third party, which is arguable I would think, it certainly has the authority to audit the actions of that body. One certainly follows the other. Strange fears that Congress is seeking to take over monetary policy sound a bit paranoid, and more like an excuse for maintaining a status quo of secrecy rather than reflecting any real intentions of an audit.
See Federal Reserve Act of 1913. Yes, it was passed by Congress and amended by Congress several times over the years.
Would that mean that Congress can give the authority to provide and maintain a Navy to a private body?
Congress "provides and maintains" the navy per the Constitution. But, Congress doesn't run the Navy, the Department Of Defense does. Yet another example of delegating.
What about regulating commerce with foreign Nations?
Gee, I think Congress passed NAFTA and delegated to the Dept. of Commerce...good catch.
As I stated earlier, if Congress wants to change/replace the Federal Reserve Act, that's well within its power. If Congress wants to change the Audit Act of 1978, that too is within its purview.
Strange fears that Congress is seeking to take over monetary policy sound a bit paranoid, and more like an excuse for maintaining a status quo of secrecy rather than reflecting any real intentions of an audit.
LOL! I dig the projection. How about learning how our Federal Government works before slinging the allegations? Your library likely has a civics book with your name on it.
See Federal Reserve Act of 1913. Yes, it was passed by Congress and amended by Congress several times over the years.
I never suggested that Congress didn't pass it, but only questioned the validity of the idea that Congress can in fact delegate its own powers, enumerated in the Constitution, to a private body. And I didn't even say it couldn't, but only stated that I have doubts about that presumption. You seem very comfortable with it, but I am not.
Congress "provides and maintains" the navy per the Constitution. But, Congress doesn't run the Navy, the Department Of Defense does. Yet another example of delegating
Not quite. As you note, the Congress does in fact "provide and maintain" the Navy, as per the Constitution, and therefore did not delegate any of its power to a private body. Additionally, the Department of Defense is not "private."
You are confusing the issues on these things. Congress certainly has exercised its oversight and authority in various ways, and using various bodies. But that does not mean that it has actually transferred any of its enumerated powers, as listed in the Constitution, directly to private organizations (excepting the Federal Reserve of course). For instance, only Congress can legislate, and there is no suggestion that the Founders or anyone else has ever felt that that authority could actually be delegated to another organization. Could Congress do it? Probably, but that would not make it Constitutional, which is the foundation of my point.
LOL! I dig the projection. How about learning how our Federal Government works before slinging the allegations? Your library likely has a civics book with your name on it.
I am always impressed by the withering retort of "LOL," and such broad and apparantly meaningless responses do nothing to bolster your position. The Congress has every authority to oversee and audit the Federal Reserve and this bill seems to be seeking no more than that. Bernanke, it would seem, is desirous to fend this off under the guise of remaining "independent." Arguments that Congress is making a grab at their own Constitutional authority is not convincing in the least, and smacks of paranoia. Your suggestion that a civics book in the library will alter that appearance is no more convincing to me than is the paranoid claim itself.
Oh really? I thought you might be catching on, but, no such luck. Ever hear of the Post Office? Is the Congress running that? Is it an independent agency much like the Fed? How about the CIA, the SEC, NASA or CFTC? There are many independent agencies. Please enlighten me as to how the Fed is "private" as opposed to these other agencies. And if you could, please let me know why your concern begins and ends with the Fed?
Also, "LOL!" is a polite retort to someone who throws around words like "sinister" and "paranoid" in a discussion about how the government works. I've not attributed anything "sinister" or "evil" to HR 1207. I do consider it a joke, but not sinister. I've stated that Congress may amend its own law that was passed in 1978. I've also said (get this -- my opinion) it might not be wise. Finally, I even said that Congress might wish control monetary policy (which you claim they cannot delegate...although you are wrong). I'm so glad you're here to read my mind.
Oh really? I thought you might be catching on, but, no such luck. Ever hear of the Post Office? Is the Congress running that?
I think this is a bad example for a couple of reasons. First, it does not necessarily show a delegation of a specific enumerated power. Management may be implied by the word establish, but I would think it is at least arguable. Also, I am unaware of the Post Office resisting oversight by Congress by invoking some idea of "independence." For that reason I can think of no real relevance to the type of "delegation" being discussed here.
And if you could, please let me know why your concern begins and ends with the Fed?
That seems a rather presumptuous position. I don't think I have ever suggested that anything I think at all begins or ends with the Fed. But, we are in fact discussing the Fed, and so I have stayed focused on it. But, in any event, I have merely objected to the ridiculous claim that a law by Congress calling for oversight and auditing of an agency operating under its authority as enumerated in the Constitution itself is actually a power grab of some sort which threatens some fictional "independence" of that organization. No agency existing entirely at the whim of the Legislature and receiving every authority and power they have from that body has any claim to any independence. They are, most definitively, dependent.
Finally, I even said that Congress might wish control monetary policy (which you claim they cannot delegate...although you are wrong).
I think it is clear that you and I are not discussing the same idea by the word delegation. This seems to be reflected here by your words "might wish control [sic] monetary policy." The Congress is given not only the power to coin money and regulate the value of it, but surely the duty and responsibility to do so as well. They might establish an agency which is empowered to act on behalf of Congress, and so long as that agency operates under Congress, answering to it and is regulated by it then I would say Congress is still fulfilling its duty. This is certainly delegation, but it is nothing like what we are talking about here.
Bernanke argued that the Fed is independent of Congress, and should remain so. If this were true, then Congress would not in fact be regulating the value and coining money, by way of an agent or otherwise, but would have in fact transferred their power and duty over to another entity entirely. That is what independence is, after all. So the Fed would not be an agent of the Congress but a power to itself, and that is very dubious constitutionally. There is no Fed defined there, and no such power given to them, and there is nothing there saying that a power or duty of Congress is transferrable to another entity. It is this understanding of "delegate" which I am responding to and questioning in this thread since that is what Bernanke claimed.
Bernanke refers to this proposed law as something akin to a power grab which threatens the "independence" of his agency. That "independence" though is a fiction, and his remarks most certainly do smack of paranoia and a desire for secrecy. The Fed should be an agent of Congress, if it is to exist at all, just as Congress is most assuredly an agent of the People. If the Fed is independent of the Congress then it is independent of the People, which means that it operates outside of the law. I can see no way in which that can be seen as a good thing.
That's why it was changed from a cabinet-level department into an independent agency by Congress, right? Congress did NOT delegate to the Post Office Dept, and in 1971 they did NOT delegate to the Postal Service. Gotcha.
No agency existing entirely at the whim of the Legislature and receiving every authority and power they have from that body has any claim to any independence.
Congress has passed laws that detail the status of GAO, Federal Reserve and the Dept. of Energy. Can you articulate the difference?
They might establish an agency which is empowered to act on behalf of Congress, and so long as that agency operates under Congress, answering to it and is regulated by it then I would say Congress is still fulfilling its duty.
Which entity has ever existed that "coined money" and operated under the Congress?
Congress has the authority to coin money and regulate its value, and only Congress has that authority. If they create the Fed and have them do some of the work the Fed is still dependent on Congress and must answer to it. If you worked for a firm and managed a job you would be responsible to your employer to do the job to their specifications. Even if you delegated the work to an outside firm you would still be responsible to your employer for the work. You answer to them, and any subcontractors answer to you. If a subcontractor could claim independence from you and make changes to the work which you didn't authorize, and outside of any possible intervention of your employer then one could hardly say you did your job. And it was still your job, since you were the one given the authority and responsibility to carry it out.
I have no problem with Congress creating agencies and offices to do their work. That is not being debated, except perhaps by you. However, It is still THEIR work, and this is where the comments by Bernanke in response to the proposed bill comes in. The Fed does not answer to We the People, but Congress does. Congress must be able to oversee and regulate THEIR work, so that we can be able to oversee and regulate them. If the Fed is independent then they are operating outside of the Constitution, and that is a fact. Bernanke's claims of independence of Congress and suggestion that audits are wrong for that purpose are absolutely impossible. No agency or office that Congress creates and empowers to do the work of the Congress can ever be independent of the Congress.
LOL! (Yes, there it is again.). So you can't articulate the difference. A simple "I don't know" would have sufficed rather than the three paragraphs.
If the Fed is independent then they are operating outside of the Constitution, and that is a fact.
If it is, indeed, a fact, you'll be able to provide a source, right? The Fed's only been around for 95 years so I'm sure you can find some source to bolster your "fact".
LOL! (Yes, there it is again.). So you can't articulate the difference. A simple "I don't know" would have sufficed rather than the three paragraphs.
Ah, yes. There it is again. "LOL." Obviously, you are an intellect to be reckoned with. Perhaps you don't realise that this is not an IM session with your BFF?
Awwww, I'm so hurt. You don't want to be my friend?
Surely the superior intellect would not have resorted to ad hominem. Did I miss your link to a source about the Fed's dependence on Congress? Or is it really that hard to say "I don't know"?
Surely the superior intellect would not have resorted to ad hominem.
So you really think my insistence that LOL is a childish and insubstantial commentary not befitting an adult message board is an ad hominem? Well, you are free to feel as you like.
Did I miss your link to a source about the Fed's dependence on Congress? Or is it really that hard to say "I don't know"?
If you think the Fed really doesn't depend on Congress for its existence and authority, please post your source. Might I suggest you look at the Constitution, since no other law can supersede it.
And, did I miss your explanation of how Bernanke's argument that Congress, by his own words, should not "look at" or "evaluate" what the Fed is doing because the Fed is "independent" is anything other than how I characterized it, an apparently paranoid defense for continued secrecy? So far you have not really supported your position at all, outside of LOLs and repeated demands regarding researching the history of the Post Office. Neither seem relevant.
If that carveout was eliminated, Congress would have the authority anytime to ask the GAO to come in, and audit, and look at, and evaluate the monetary policy decisions made by the Fed. That's not consistent with independence.
If you do not want people to "look" at something, then you are keeping it secret. If they should not "look" because of what you presume they will do because of what they see, then you are being paranoid. If you argue for this because you insist you are "independent" then you are saying that you are not subject to the control of those who would be doing the "looking," in this case the Congress. As I said before Strange fears that Congress is seeking to take over monetary policy sound a bit paranoid, and more like an excuse for maintaining a status quo of secrecy rather than reflecting any real intentions of an audit. You have not been able to dissuade me of that notion, and unless you can move up to four letter IRC acronyms, I am doubtful of your chances.
Nope. Your attacking my intellect instead of arguing the facts is the ad hominem. BTW, LOL has been around FR longer than you have been a member (at least under the name cothrige). It's also been used on bulletin boards of all sorts for years and years (I'll leave you to peruse the adult BBS, try not to get a virus).
If you think the Fed really doesn't depend on Congress for its existence and authority, please post your source
Why would I bother providing a source for something I never posited? Gee, when I look back at this thread I see me asking you if you are familiar with Congress' passing the Federal Reserve Act. I think I'm well aware that Congress legislated the Fed into existence and provided for its authority within that legislation. What were you up to? Stating that Congress can't do things like delegate the power to regulate commerce with foreign nations.
And, did I miss your explanation of how Bernanke's argument that Congress, by his own words, should not "look at" or "evaluate" what the Fed is doing because the Fed is "independent" is anything other than how I characterized it, an apparently paranoid defense for continued secrecy?
Yes, you missed it. Apparently, you were so hot to climb on this thread with your lack of knowledge that you didn't read anything. Now you want another chance? Sorry, cothrige, you lose.
If you do not want people to "look" at something, then you are keeping it secret.
Here's an idea for you (after you get over your mock surprise of finding internet slang on the internet): Go study the Audit Act of 1978 that Congress passed and which spells out exactly what the GAO can audit. Here's your linky, sweety. Oh, and since you have clearly demonstrated your thorough grasp of the law on the books, here's your link to the U.S. Code -- otherwise known as the law on the books. Try not to get paranoid over the real law, bud.
(I'll leave you to peruse the adult BBS, try not to get a virus).
Oooo! Pretty funny you are.
Why would I bother providing a source for something I never posited?
Could not agree more.
What were you up to? Stating that Congress can't do things like delegate the power to regulate commerce with foreign nations.
You shouldn't exaggerate. It's poor form.
Yes, you missed it. Apparently, you were so hot to climb on this thread with your lack of knowledge that you didn't read anything. Now you want another chance? Sorry, cothrige, you lose.
Oh, but another funny. I really shouldn't drink milk while reading your posts.
Here's an idea for you (after you get over your mock surprise of finding internet slang on the internet): Go study the Audit Act of 1978 that Congress passed and which spells out exactly what the GAO can audit. Here's your linky, sweety.
Those are very nice darlin'. And let me tell you, honeypie, that I am just plum tickled pink that you shared those with me. I will rush out and read them through just so I can find out how they change the meaning and context of Bernanke's statements, and I just know they will. And, in the meantime, you just take care of your little old self now, booger bear.
TTFN :-)
Let's take a stroll down memory lane to post 34 by lil ol' u:
However, that is not really the point here. Congress is not even trying to exercise its authority to revoke the Federal Reserve Act or any revision of it
So Congress passes the Audit Act in 1978. This law spells out what the GAO may audit. In order for the GAO to audit other areas, Congress will need to revise this law. If a change in the law was not required, why did Ron Paul sponsor HR 1207? Do you want to contact Ron Paul and let him know your secret method of conducting the audit? -- i.e. since the Fed is not really independent, Bernanke has to do whatever they say.
You're pretty fired up against those who know the law and those who follow the law, but you don't seem to be all that interested in those who made the law and can actually change the law. Under the current law Bernanke doesn't have to tell the Congress or the GAO or Ron Paul or you squat about OMO. If you don't like that, tough. Go join the Pauleans and try to get HR 1207 or HR 833 passed. Unless Congress changes the law, you don't get squat, no matter how much you label folks as paranoid and their adherence to the law as sinister or secretive.
So Congress passes the Audit Act in 1978. This law spells out what the GAO may audit. In order for the GAO to audit other areas, Congress will need to revise this law. If a change in the law was not required, why did Ron Paul sponsor HR 1207?
Of course HR 1207 will change which areas the GAO can audit. Title 31 section 714 subsection b of the U.S. Code restricts just what can be audited by the Comptroller of the GAO. HR 1207 would remove those restrictions, including transactions with foreign central banks and foreign governments, among others.
Do you want to contact Ron Paul and let him know your secret method of conducting the audit? -- i.e. since the Fed is not really independent, Bernanke has to do whatever they say.
I am sorry, but I don't understand what you are saying here. Are you arguing that if the Congress passes this legislation Bernanke would not have to submit to the audits? Surely you don't mean that.
You're pretty fired up against those who know the law and those who follow the law, but you don't seem to be all that interested in those who made the law and can actually change the law.
"Fired up against" somebody? No, I wouldn't say that at all. I am assuming, perhaps wrongly, that you have an impression that I am against the Fed and for the Congress taking over our monetary policy. No, I wouldn't say that. But, I do believe that Congress is ultimately responsible for our monetary policy (the Constitution lays it on them after all) and that the Fed acts as agents of the Congress. By that reasoning I cannot see why the Congress should not have more comprehensive audits than are now carried out. I also disagree with comments which suggest that Congress lacks authority over these issues just because of the creation of the Fed, as this supposes a transfer of power and that, obviously, bothers me.
Under the current law Bernanke doesn't have to tell the Congress or the GAO or Ron Paul or you squat about OMO.
Yes, I agree. Though I am not really sure why that is automatically a good thing.
If you don't like that, tough. Go join the Pauleans and try to get HR 1207 or HR 833 passed. Unless Congress changes the law, you don't get squat, no matter how much you label folks as paranoid and their adherence to the law as sinister or secretive.
I take exception to this last statement. I never called anyone paranoid, secretive, or otherwise for not telling Congress something which they are not legally compelled to divulge. What I have said sounds a "bit paranoid" and seems like "maintaining a status quo of secrecy" are the comments made by Bernanke in arguing against this legislation. Those are two very different things. And I have given detailed reasons for my feeling that way, which you are free to attempt to disabuse me of if you so desire.
This is what I have been driving at. I can tell it bothers you. I can tell from many others on FR that it bothers them, too. But, it's the law just as surely as the National Banking Act was the law before the FRA. The only way to change that is to convince enough like minded people that it needs changing. Good luck, but I'm not in the camp that believes it needs changing.
Surely you don't mean that.
Correct again. I was demonstrating that there is no audit silver bullet -- i.e. the law needs to be revised in order to extend GAO audit authority to other areas.
Though I am not really sure why that is automatically a good thing.
It's akin to Congress requiring the Fed to run TALF after Dec 31, 2009. Congressmen are already lobbying the Fed to extend TALF. Right now you have Barney Frank threatening the banks to not foreclose or he will push a Cramdown Bill. These types of tactics do not make for sane policy. They're politicians and they like to get re-elected and they don't mind bending the law in the process. Yes, it sucks.
What I have said sounds a "bit paranoid" and seems like "maintaining a status quo of secrecy" are the comments made by Bernanke in arguing against this legislation.
Bernanke has also said that he would work with the GAO to get them whatever they needed without changing the law. That doesn't strike me as secretive or paranoid. Why shouldn't the GAO take him up on his offer? If they don't get what they need, I'm sure they would report that to Congress who could consider legislation. I see this as a very prudent course that has the potential to satisfy all parties. But since Bernanke extended the offer all you hear is crickets.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.