Senator Paul Re-Introduces Fed Audit Bill With 30 Co-SponsorsJeff Kearns
Senator Rand Paul re-introduced legislation proposing to audit Federal Reserve monetary policy, stepping up efforts to rein in the central bank’s powers with the Senate now controlled by his fellow Republicans.
Twenty-nine Republican senators are co-sponsors of the bill, along with Democrat Mazie Hirono of Hawaii, according to Paul spokeswoman Eleanor May. The bill language is the same as legislation introduced in the last Congress by the Kentucky lawmaker and potential 2016 presidential contender.
Paul’s bill would remove limits on the Government Accountability Office’s audits of Fed operations, allowing scrutiny of interest-rate decisions and securities purchases. The Fed has held interest rates near zero since December 2008 and more than quadrupled its balance sheet to $4.51 trillion.
Republicans, in control of both chambers of Congress, have criticized the Fed for its rescue of big Wall Street banks in the financial crisis and for keeping rates low.
The Fed “operates under a cloak of secrecy and it has gone on for too long,” Paul said in a statement today. “The American people have a right to know what the Federal Reserve is doing with our nation’s money supply.”
Other co-sponsors, according to May, include Senate Majority Leader Mitch McConnell, also of Kentucky, and Mike Crapo of Idaho, the second-ranking Republican on Senate Banking Committee, which must approve the bill before it would advance to the floor. Banking Chairman Richard Shelby isn’t listed as a co-sponsor.
Fed Chair Janet Yellen said last month that she will speak “forcefully” against the idea of monetary policy audits.
“It’s important to make sure that we can make the decisions we think are best free of short-run political interference with respect to monetary policy,” Yellen said at a Dec. 17 press conference. “History shows not only in the United States, but around the world, that central bank independence promotes better economic performance.”