The House of Representatives has just passed a bill that would authorize the federal government to audit the Fed. The bill may not go anywhere, but an increasing number of people want more transparency in how the country's central bank conducts its affairs.
Call to audit the Fed gaining momentum
The Fed controls how much a dollar is worth and the money it takes for a bank it lend mortgages, installment loans and more. It was created in 1913 and impacts daily life regularly with its control of lending and inflation. Many people do not realize how much it affects their life every single day.
A ton of legislators and citizens have asked that the Federal reserve be audited, which is why a brand new bill is being considered that would require the Federal reserve to open its book up to the public. It is an "independent government agency" technically meaning that it is part of the government but is a private company still.
House of Representatives decision
The Federal reserve has been criticized by Ron Paul of Texas for some time, which is why he sponsored the bill which passed 327 to 98 in the House of Representatives. ABC points out that the House is ready for additional government agencies to show their finances.
The basic idea of the bill would allow more access to Federal reserve policy decisions. Right now, records from meetings where the Federal reserve decides to adjust the inflation rate on currency take three weeks to be released and five years for the transcript to come out. The bureau publishes its balance sheet every week online too. CNN points out that Deloitte and Touche just did an internal audit. The audits are done yearly. The idea of the bill is for additional instant access though.
An enormous problem according to Bernanke
Fed Chairman Ben Bernanke has often warned, according to Bloomberg, that an "audit the Fed" law that goes too far will place the bureau under direct Congressional control, which could possibly put the bureau at risk of manipulation for political purposes. Part and parcel to the agency's creation was that it remains independent of Congress, which is often as fickle as public opinion. He does, however, advocate for greater transparency.
The bill is not likely to pass in the Senate. Bloomberg quoted Representative Barney Frank as saying "no one here expects it to become law."
Call to audit the Fed gaining momentum
The Fed controls how much a dollar is worth and the money it takes for a bank it lend mortgages, installment loans and more. It was created in 1913 and impacts daily life regularly with its control of lending and inflation. Many people do not realize how much it affects their life every single day.
A ton of legislators and citizens have asked that the Federal reserve be audited, which is why a brand new bill is being considered that would require the Federal reserve to open its book up to the public. It is an "independent government agency" technically meaning that it is part of the government but is a private company still.
House of Representatives decision
The Federal reserve has been criticized by Ron Paul of Texas for some time, which is why he sponsored the bill which passed 327 to 98 in the House of Representatives. ABC points out that the House is ready for additional government agencies to show their finances.
The basic idea of the bill would allow more access to Federal reserve policy decisions. Right now, records from meetings where the Federal reserve decides to adjust the inflation rate on currency take three weeks to be released and five years for the transcript to come out. The bureau publishes its balance sheet every week online too. CNN points out that Deloitte and Touche just did an internal audit. The audits are done yearly. The idea of the bill is for additional instant access though.
An enormous problem according to Bernanke
Fed Chairman Ben Bernanke has often warned, according to Bloomberg, that an "audit the Fed" law that goes too far will place the bureau under direct Congressional control, which could possibly put the bureau at risk of manipulation for political purposes. Part and parcel to the agency's creation was that it remains independent of Congress, which is often as fickle as public opinion. He does, however, advocate for greater transparency.
The bill is not likely to pass in the Senate. Bloomberg quoted Representative Barney Frank as saying "no one here expects it to become law."
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