Sunday, July 25, 2010

Three-Quarters of Congressmen Support Auditing the Federal Reserve, so Why Isn't It Law?

Barney Frank is at it again. If we do not get rid of Barney and Chris Dodd, this country's economy will not survive. Barney has the power to flaunt the will of 73% of the House. This is too much power vested in one person, especially an ideologue like Barney.

The necessity for an audit of the Fed is highlighted in an article in the American Spectator that I commented on,America's Ruling Class. The question is who is running America, the people, the government or the "Ruling Class". The Fed is a major part of that "Class" and has been shielded from all government oversight.

H.R. 1207 has been assigned to the Subcommittee on House Financial Services -- the same committee that brought us the banking disaster which nearly crashed the economy in 2008. Barney Frank (D-MA), as the chair of the committee, has simply decided to ignore consideration of the bill and let it die by inactivity, a.k.a. pigeonholing. Since Frank sets the schedule for the committee, he has the power to exercise a veto on the proposed law -- a veto that cannot be overridden, bypassed, or otherwise circumvented. Essentially, Frank, like all committee chairs, can decide on his own to kill bills referred to his committee that he doesn't like -- and he clearly dislikes H.R. 1207. Since this is a familiar game played in Washington by both parties with dozens of bills, the question might be, "Why should we care about this specific bill so much?"

Thomas Jefferson was clear on a number of occasions about what he thought of the concept of a private bank issuing the currency of the land. As president, in an 1802 letter to Albert Gallatin, the longest-serving Secretary of the treasury, Jefferson said,

If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.

Our representatives in Congress have no power to alter the interest rate, alter the circulation of currency, or change the amount that can be loaned to a local bank. It is all the purview of the Federal Reserve, decided by its Board of Governors. The stereotypical image of a few people sitting in a room deciding the fate of the economic world is fact in the Federal Reserve. Congress has no power to dismiss a member of the Federal Reserve Board, revert a bad decision, or apply any other check. The economic lives of the people of the USA are controlled by the Federal Reserve, and there is nothing they can do about it -- no one to vote out and no powers of judicial review. If the Fed decides tomorrow to jack interest rates up to 30%, no one can stop them.

The mere existence of such an all-powerful organization in our government should be disturbing to any freedom-loving person. We debate over politicians and tax rates until the moon turns blue, yet this one organization has omnipotent control over the economy, and yet it is far from transparent. It is essential to at least allow the government to audit the Federal Reserve. It is essential to the free market and the survival of the republic that one agency, and its bureaucrats, not be allowed to have unchecked and unsupervised control over the economy. In sworn testimony before Congress, Thomas E. Woods, Jr. asks, "Opponents of HR 1207 have sometimes tried to claim that the Fed is already adequately audited. If this were true, why is the Fed in panic mode over this bill?"

And he goes on to ask,

[I]f our monetary system were really as strong, robust, and beyond criticism as its cheerleaders claim, why does it need to rely so heavily on public ignorance? How can it be a sound banking system that depends on keeping the public in the dark about the condition of its financial institutions?

Despite the fact that that it seems that nearly three-quarters of the House agrees with him, it looks like the legislation needed to get to the truth will die an untimely death in committee, and once again, the Federal Reserve will have dodged the sword of accountability.
Read American Thinker article "Three-Quarters of Congressmen Support Auditing the Federal Reserve, so Why Isn't It Law?" here.

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