My colleague Kimberly Amadeo wrote a blog in opposition to an audit of the Federal Reserve. Kimberly’s main concern in her blog is that an audit of the Fed basically amounts to punishing them for their response to the economic crisis.
I agree with that assessment, an audit of the Fed shouldn’t be about punishing them. It should be about finding out the truth. This is a controversial issue, people either fall strongly to one side or the other. I think the bottom line to the issue is that too much has been hidden from the tax paying public for too long. The bailout bills were passed despite overwhelming public opposition, not to mention the final version of the bill was laced with pork that had nothing to do with “saving the economy”.
On top of this, the Fed has handed over numerous trillions of dollars to these same banks in the form of various acronyms. I think it’s fair to ask where the money went and who has what. The argument that the banks could be harmed by the information becoming public is well founded, but in my opinion that is a consequence that is well deserved. I don’t really find it reasonable that there are these zombie banks out there sucking up capital through all these programs and having the ability to keep it a secret. Not to mention, they are able to make investments with this invisible money and pay huge bonuses based on those investments. They are having a laugh at the expense of everyone.
At minimum, people have a right to know what banks have the money and whatever else the Fed has been up to for the past few decades. Multiple bubbles have been blown in the economy, decisions made behind closed doors, there are so many questions that need to be answered.
The Federal Reserve, is not federal at all, yet it carries out official duties for monetary policy, that should be based on government decisions. You might argue that the government isn’t competent for such a task. My argument would be, at least we can elect who is in government, we have no control over who runs the Fed.
There are many changes that need to be made in the US Government. It’s a mess. The Fed is not soley to blame for these issues, but it’s a good place to start. The system needs an overhaul. People in government are protecting this old failed system, instead of looking for real solution. If we are truly in an era of “change”, we should audit the Fed, TARP, and whatever else the government has been cooking up over the past few years. True solutions can only be based on truth and until an audit of the Fed happens, there won’t be any truth.
I agree with that assessment, an audit of the Fed shouldn’t be about punishing them. It should be about finding out the truth. This is a controversial issue, people either fall strongly to one side or the other. I think the bottom line to the issue is that too much has been hidden from the tax paying public for too long. The bailout bills were passed despite overwhelming public opposition, not to mention the final version of the bill was laced with pork that had nothing to do with “saving the economy”.
On top of this, the Fed has handed over numerous trillions of dollars to these same banks in the form of various acronyms. I think it’s fair to ask where the money went and who has what. The argument that the banks could be harmed by the information becoming public is well founded, but in my opinion that is a consequence that is well deserved. I don’t really find it reasonable that there are these zombie banks out there sucking up capital through all these programs and having the ability to keep it a secret. Not to mention, they are able to make investments with this invisible money and pay huge bonuses based on those investments. They are having a laugh at the expense of everyone.
At minimum, people have a right to know what banks have the money and whatever else the Fed has been up to for the past few decades. Multiple bubbles have been blown in the economy, decisions made behind closed doors, there are so many questions that need to be answered.
The Federal Reserve, is not federal at all, yet it carries out official duties for monetary policy, that should be based on government decisions. You might argue that the government isn’t competent for such a task. My argument would be, at least we can elect who is in government, we have no control over who runs the Fed.
There are many changes that need to be made in the US Government. It’s a mess. The Fed is not soley to blame for these issues, but it’s a good place to start. The system needs an overhaul. People in government are protecting this old failed system, instead of looking for real solution. If we are truly in an era of “change”, we should audit the Fed, TARP, and whatever else the government has been cooking up over the past few years. True solutions can only be based on truth and until an audit of the Fed happens, there won’t be any truth.
I want to be the first to thank you for your rebuttal of Kimberly’s article. Perhaps you could show your article to Kimberly so she can better understand why she received so many “vehement” responses to her opposition.
Super duper job on the rebuttal sir! Well said and easy to understand, even, I hope, for Kimberly.
Thanks a bunch for a HONEST article. It seems any article written in opposition of “auditing the fed” is either some clueless keneysian or former Fed employee or Council Foreign Relations member. Always the same.
Anyways, I hope you keep your honesty/integrity about you.
Remember, INFORMING the public of WHERE OUR MONEY IS GOING is a good thing. All of these scare tactics are just methods to keep the voters/tax payers in the dark. I would think the american public would get wise to these charlatans.
Finding out who the recipients of OUR monies, is a good thing. I mean, if all of that printed money is going to good use and not in special interests pockets or to prop up special interests, why hide that information. why?
Don’t beleive the scare tactics. Accountability is a two edged sword. If we are accountable to you, then you (THE FED) is accountable to us!
I wrote this post in Kimberly`s blog:
Nice statistics, but is FED contributing to overcome financial crisis? Mr. Stieglitz (Nobel Prize in economics) suggests firing Bernanke, I agree with him.
Thanks for your answer John!