Ron Paul wins a key battle in war to open Fed's books

[bobbyw24]

Ron Paul wins a key battle in war to open Fed's books
November 19, 2009 | 5:42 pm

Rep. Ron Paul, the Texas Republican who is perhaps the Federal Reserve’s most implacable enemy, scored a big win Thursday on Capitol Hill: The House Financial Services Committee approved adding to a financial-system reform bill Paul’s provision to begin federal reviews of the central bank’s interest-rate decisions.

The vote on the audit provision amendment was 43-26.

http://latimesblogs.latimes.com/.a/6a00d8341c630a53ef0120a6b8e747970b-800wi

Paul has for years asserted that the Fed, which by design is independent of the federal government, was corrupt and that its monetary policy would drive America to ruin by debasing the dollar.

Endthefed He has sought to abolish the Fed entirely, but because that almost certainly would never fly in Congress, Paul has worked for Plan B: He wants the Government Accountability Office to have full power to audit the central bank’s operations -- a measure the Fed bitterly opposes.

"If we get the audit and get the books open, make them answer the questions, I am convinced that the American people will be so outraged that then we will have reform of the monetary system," Paul has said.

Fed Chairman Ben S. Bernanke told Congress in June that Paul’s audit provision "would effectively be a takeover of policy by the Congress . . . [and] would be highly destructive to the stability of the financial system, the dollar and our national economic situation."

Paul contends that the Fed is overreacting. Here's how he describes what the provision would do:

--- Removes blanket restrictions on GAO audits of the Fed;

--- Allows the audit of every item on the Fed’s balance sheet, all credit facilities, all securities purchase programs, etc.;

--- Retains limited audit exemption on unreleased transcripts and minutes;

--- Sets a 180-day time lag before details of Fed’s market actions may be released;

--- Provides that nothing in the amendment should be construed as interference in or dictation of monetary policy by Congress or the GAO.

The audit-the-Fed measure is part of the financial-system-overhaul bill that the Obama administration has sought. It remains to be seen whether Paul’s Fed provision can make it through the full House and the Senate.

-- Tom Petruno

Image: Ron Paul's latest book, "End the Fed"

http://latimesblogs.latimes.com/money_co/2009/11/rep-ron-paul-texas-audit-the-fed-bill.html

[bobbyw24]

On auditing the Fed, the committee adopted a plan by Republican Rep. Ron Paul that had the support of a bipartisan roster of more than 300 members of Congress. It would give the Government Accountability Office the authority to audit the entirety of the Fed's balance sheet, credit facilities and all securities purchase programs. Critics, led by Frank and Democratic Rep. Melvin Watt, argued that Paul's proposal was too intrusive and could indirectly lead to higher interest rates. They proposed a more limited audit.

"If we open all of the discussions, the deliberations, the transactional gives and takes, what we will do is scare off capital because other governments will not deal with our Fed," Watt said.

Paul, who ran a long-shot campaign for president last year, argued Watt's more limited proposal would exclude much of the Fed's work from scrutiny.

"There is no reason in the world why this country and our people can't know eventually about what's going on in the Federal Reserve," Paul said.

In the Senate, Republican Sen. Richard Shelby, top Republican on the Senate's banking panel, sharply criticized Dodd's proposed legislation.

"It significantly expands the federal government's ability to bail out not only banks, but any large, politically connected company," Shelby said. Dodd could still pass the bill with Democratic votes in his committee but would find it far more difficult to get the needed votes in the full Senate without some Republican backing.

Dodd argued that a year after the near collapse of the financial system, it was now time to correct the government's oversight.

"As we sit here today, with gaping holes in our regulatory structure, we cannot tell our constituents that we're ready to prevent another shock," he said.

http://www.google.com/hostednews/ap/article/ALeqM5g7ffRdswXTlfgaQS0FCOZmrvbwcAD9C3063G1

[tonyTheBest]

A win for the US of A. Ron Paul finally has achieved a significant progress.

[Aratus]

true...