House Votes to Audit Federal Reserve
July 26, 2012 - 5:09 am
The vote is being seen as a “victory” for Ron Paul. But Rep. Paul doesn’t want to audit the Fed so much as get rid of it, I fail to see how much a victory it is for him, although it’s a good thing that the Fed is going to open its books and give us a glimpse of how the high priests of high finance manipulate the currency.
Since the 2008 financial crisis, the Fed has tripled its balance sheet to $3 trillion, equivalent to 20% of the economy, through an unprecedented series of bailouts and economic interventions,” said House Oversight and Government Reform Committee chairman Darrell Issa, R-Calif., who shepherded the bill through his committee. “The public has a right to understand how and under what terms decisions were made and who is responsible.”
The legislation tasks the Government Accountability Office (GAO) with auditing the Federal Reserve and reporting back within a year. The 327-98 vote amounts to a personal victory for Rep. Ron Paul, R-Texas, who has called for such an audit for years.
“Since its inception, the Federal Reserve has always operated in the shadows, without sufficient scrutiny or oversight of its operations,” Paul said in 2009. “Why should a government-established agency, whose police force has federal law enforcement powers, and whose notes have legal tender status in this country, be allowed to enter into agreements with foreign powers and foreign banking institutions with no oversight?”
The U.S. Senate must still approve the audit. “Campaign for Liberty is excited to see the U.S. House respond to the countless calls, emails, and petitions from our members urging their representatives to take action and hold the Fed accountable for its reckless policies,” Matt Hawes, Vice President of Campaign for Liberty — a non-profit launched by Paul in 2008 — said in a statement today. “C4L will keep rallying Americans across the country, and we hope their senators will respond with another bipartisan show of support for the Audit the Fed bill.”
The Fed released trillions of dollars in credit in 2008 when the credit markets froze and the economy was in danger of coming to a standstill. Even the largest corporations couldn’t get credit to meet their payroll or pay their overhead. This wasn’t an illusion; it was real. If the Fed hadn’t acted — followed Ron Paul’s advice — what would the economy look like today? No doubt many Paulbots would have cheered the downfall of our “fiat” money but the consequences for millions would have been catastrophic.
I think its a good idea to audit the Federal Reserve. But as far as adopting some of Ron Paul’s crackpot economic schemes such as a return to a modified gold standard and “open competition among currencies,” let’s hope that the Fed audit is the last of any “victories” enjoyed by the Texas congressman.