Trump’s campaign slogan “drain the swamp” has many of his supporters anxiously awaiting the end of business-as-usual in Washington. An announcement Wednesday that Trup is backing Sen. Rand Paul’s “Audit the Fed” bill brings a step in that direction. The Federal Reserve, despite being our nation’s central bank, is not under the control of the government.
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Rand Paul, like his father Ron Paul before him, is calling for a full-on audit of the Fed. Rep. Thomas Massie (R-Ky.) and Sen. Rand Paul (R-Ky.) have re-introduced the idea after their first attempts failed in 2016.
“The U.S. House has responded to the American people by passing Audit the Fed multiple times, and President-elect Trump has stated his support for an audit. Let’s send him the bill this Congress,” Rand Paul said.
The bill hopes to shift oversight of monetary policy to the Government Accountability Office.
Former Federal Reserve Chairman Ben Bernanke, and many others, have alluded to the dangers posed by an actual audit. If there were to be fraud discovered at the Fed, US currency would be at jeopardized.
“My concern about the legislation is that if the GAO is auditing not only the operational aspects of the programs and the details of the programs but making judgments about our policy decisions would effectively be a takeover of monetary policy by the Congress and a repudiation of the independence of the Federal Reserve would be highly destructive to the stability of the financial system, the Dollar and our national economic situation.”
Janet Yellen said this in November 2013:
“So I strongly support as indicated transparent and openness on the part of the fed and I think with respect to monetary policy in terms of the range of information and the timeliness of that information we are one of the most transparent central banks in the world. What I would not support is a requirement that we diminish the independence of the federal reserve in implementing and deciding on monetary policy. For 50 years congress has recognized that there should be an exception to GAO ability to audit the fed to avoid any political inference in monetary policy I believe it’s critically important for the economic performance of this country and we’ve seen this around the world that allowing a central bank to be independent in forming monetary policy is critical to assuring markets and the public that we will achieve price stability and I would be very concerned about legislation that would subject the Federal Reserve that could interfere with that independence.”
There may be bipartisan support for the bill, too. Bernie Sanders has been a vocal critic of the Fed. In 2009, he confronted Bernake about $2.2 Trillion that the Fed loaned to banks. In 2010, there was $9 trillion unaccounted for.
Ron Paul spoke glowingly of his son’s new bill:
“I applaud my son Senator Rand Paul and my friend Representative Thomas Massie for their leadership on the important issue of auditing the Federal Reserve. Audit the Fed is the type of change the American people demanded when they went to the polls last November.”
“For 105 years, the Federal Reserve has exercised almost absolute and unquestioned authority over America’s monetary policy. The result has been a boom-and-bust business cycle, growth in government, increasing income inequality, and a loss of over 90% of the dollar’s purchasing power. No wonder almost 80% of Americans support Audit the Fed!”
“While campaigning for President, Donald Trump not only criticized the Fed’s easy money policies, he also endorsed Audit the Fed. With a President who supports Audit the Fed finally sitting in the White House, Congress has no excuse to not quickly pass this bill and finally let the American people know the truth about the Fed’s conduct on monetary policy, including its dealings with foreign governments and central banks.”