238 Members of Congress Disagree with the President: The Fed Needs More Accountability
Posted in: financial crisis
The President wants to give the Federal Reserve more power to oversee systemic risk in the economy:
Obama, in an interview shown on the CBS Early Show, said the administration wants an overseer that "is accountable and clear when it comes to these large systemic firms that could potentially bring down the entire financial system. The Fed has the expertise and the credibility I think to do it."
Asked whether lapses by the Fed contributed to last year’s crisis, Obama said, "It wasn’t the Fed where regulations broke down here."
But 238 members of Congress disagree that the Fed is "accountable and clear," and there are now 237 bipartisan cosponsors to Ron Paul’s H.R. 1207, the Federal Reserve Transparency Act, which would give the GAO the authority to audit the Fed and report its findings to Congress. Because right now, the Fed has loaned trillions of dollars in bailout money, and refuses to say where it went.
As Alan Grayson said in a letter to his colleagues, asking them to cosponsor the bill:
[T]he Federal Reserve has refused multiple inquiries from both the House and the Senate to disclose who is receiving trillions of dollars from the central banking system. The Federal Reserve has redacted the central terms of the no-bid contracts it has issued to Wall Street firms like Blackrock and PIMCO, without disclosure required of the Treasury, and is participating in new and exotic programs like the trillion-dollar TALF to leverage the Treasury’s balance sheet. With discussions of allocating even more power to the Federal Reserve as the ‘systemic risk regulator’ of the credit markets, more oversight over the central bank’s operations is clearly necessary.
As a result of Grayson’s efforts to whip Democratic cosponsors, 47 have signed on in the past two weeks alone, including Donna Edwards, Carol Shea-Porter, Jackie Speier, Dennis Kucinich, Heath Shuler, Jim McGovern and Jared Polis.
5780 people have endorsed Grayson’s efforts to bring accountability to the Fed, including Dean Baker, Naomi Klein, Bill Greider, Tyler Durden, Bill Black and Jamie Galbraith.