Audit the Fed

[RI]

Of course not. It's pure idiocy.

[RI]

The largest virtue of the Fed is that it is an "unchecked" (which isn't true), antidemocratic force (though ultimately no more so than the Supreme Court. It would fail de Tocqueville's definition) that's designed to be the "adult in the room".  Having a democratically-controlled monetary policy is the fastlane to economic devastation, a fact repeatedly borne out by history.

Absolutely not. This is one of the worst ideas about how to fix the government I've ever heard. If the Fed is doing something they aren't "supposed" to be doing, exposing it will only bring the problem to light and shatter confidence. Economics is all (well not all, but a whole lot of it) about confidence, whether it be in future growth or the value of our currency. Intentionally taking a risk like this, with little or no apparent upside value, is a terrible idea.

And if all of that doesn't scare you, the very thought of the Fed being run by Congress ought to.

I'm kind of on the fence on this one... but what if the Fed is actually doing something that will hurt the economy in the long run?  Say then, maybe, those wrongdoings were to be discovered later and confidence is shattered, then?  I get the whole 'ignorance is bliss' idea, but letting such a powerful arm of the government like the Fed go totally unchecked just sounds foolish to me.

You do realize that the financial statements of the Federal Reserve are already audited by the GAO, right? Any sort of manipulation of the money supply would surely have to show up there due to the limited abilities that the Fed has to actually undertake monetary policy.

What the latest bills want are not financial audits but the actual proceedings and documentation of meetings where the Fed makes any of its decisions (a "management audit"). Paul's bill would let Congress analyze any decision the Fed makes at their whim. That sounds like politicization to me.

[RI]

Also, I find it the height of irony that the one bill of Paul's that ever passed the House not only would expand the power of the federal government and Congress, but also would provide the groundwork for the greatest inflation crisis in modern US history. It's almost poetic.

[RI]

Also, I find it the height of irony that the one bill of Paul's that ever passed the House not only would expand the power of the federal government and Congress, but also would provide the groundwork for the greatest inflation crisis in modern US history. It's almost poetic.

How would a simple audit of the Federal Reserve's finances cause the 'greatest inflation crisis in modern US history'? Beyond that, the United States economy is incredibly deflated. It wouldn't cause hyperinflation (I'm not convinced it would cause much inflation at all), but even if it caused some inflation, it would be a bet positive. Some degree of Inflation is good for a deflated economy.

Did you read my other post? The Fed is already being audited on a regular basis. What the bill that passed the House does is give Congress review of every single decision the Fed makes. They can see any document the Fed has, and call Fed officials to have to justify any decision they make. With Congress essentially perpetually breathing down their neck, you really think the Fed wouldn't try to just appease Congress eventually? That right there is the death knell of an independent central bank. Studies and logic both show that the less independent the central bank, the higher the average rate of inflation in a country; heck, it's happened before in the United States.

Secondly, if you think inflation is a good thing right now, why do you care if the Fed printed off some money to loan to faltering institutions (which evidence shows they didn't--any money used was their own)? That would only either increase the base money supply or have no effect.