Senate votes 96-0 to audit Fed

Ikari · May 17, 2010

Kandahar said:
They aren't giving it away. Congress has simply chosen to exercise its authority to regulate money by establishing a Federal Reserve System. This means that acts of the Fed are acts of Congress. Congress has the power to end this authority at any time.

Exactly, and they can audit them at any time they wish to ensure that the Fed is acting properly because the Fed is property of Congress.

Kandahar said:
No it's not. Voting is the mechanism through which congressional power is exercised, not one of the congressional powers.

Voting is the method by which power is exercised, true. But if they have the ability to give away all power, then they can give away the mechanism by which power is decided upon.

Kandahar said:
So just to clarify, you DO think that Congress should have a debate and vote on every single post office in the country instead of outsourcing that responsibility to the USPS?

I think they have the power to debate and vote on every single post office in the country.

Kandahar said:
Can =/= should.
I don't think anyone has argued that they CAN'T do that.

They are the same for the purpose of this discussion. Congress can and should audit the Fed yearly.

Kandahar said:
Why?

Why? Because the Fed is property of the Congress. Because only Congress was given the power to print and regulate the value of our currency. Thus the Fed must be made to properly do the job it is entitled to do through Congress and through the power and sovereignty of the People.

Kandahar said:
Does this kind of dishonest twisting of words actually pass for debate where you're from?

Nope, but the point stands. If the Fed has something to hide, we should know about it. If the Fed is acting improperly, we should know about it. If the Fed is doing horrible things, we should know about it. And the way you know about it is to audit them; something well within the power of the Congress to do since the Federal Reserve is property of Congress.

Kandahar said:
I'm curious. What kind of problems do you imagine you're going to discover? And what makes you confident that correcting them is worth the cost to the Fed's independence?

Monkeying around with interest rates to best benefit Wallstreet and the Banks instead of fulfilling its mandate to balance inflation and unemployment. And the Fed should not be 100% independent since it must belong to Congress.

ricksfolly · May 17, 2010

danarhea said:
And now, I would like to thank someone who has been proposing to audit the Fed for more than 20 years, and who never wavered from this proposal, which he repeatedly introduced into the House. Once called "crazy", this proposal is now passed by a unanimous vote in the Senate.

I'm really surprised at Congress for passing that law. What the feds do may be questionable, but it plays a big part in world wide financial stability, and the trillions of cash they circulate all over the world has very little effect on our solvency. After all, it's just paper.

ricksfolly

danarhea · May 17, 2010

ricksfolly said:
I'm really surprised at Congress for passing that law. What the feds do may be questionable, but it plays a big part in world wide financial stability, and the trillions of cash they circulate all over the world has very little effect on our solvency. After all, it's just paper.

ricksfolly

Actually, that is the whole problem, in a nutshell.

Kandahar · May 17, 2010

Your entire argument can be boiled down to the following statement:

Ikari said:
They are the same for the purpose of this discussion. Congress can and should audit the Fed yearly.

No. They are NOT the same for the purpose of this discussion. No one has disputed that Congress has the POWER to audit the Fed. The dispute is whether or not it's a good idea. If your only rationale is "because they can," that's an absurd way to pursue policy.

Ikari said:
Nope, but the point stands. If the Fed has something to hide, we should know about it. If the Fed is acting improperly, we should know about it. If the Fed is doing horrible things, we should know about it. And the way you know about it is to audit them; something well within the power of the Congress to do since the Federal Reserve is property of Congress.

That is not the way Washington works. It doesn't matter what the investigation turns up, and there's no particular reason to suspect the Fed of any wrongdoing. The purpose of the audit is so that congressmen can run with whatever scraps they can turn up and use it to attack the Fed.

Imagine that you're the CEO of a big company. I launch an investigation (without any basis whatsoever) to determine whether or not you've embezzled money from the company, and I loudly tell the newspapers all about my investigation. Are you OK with that? After all, if you've done nothing wrong you have nothing to hide, right? The mere presence of congressional investigators breathing down the Fed's neck compromises its independence. And since there is no reasonable suspicion that the Fed has acted inappropriately, they should not launch the investigation in the first place.

Ikari said:
Monkeying around with interest rates to best benefit Wallstreet and the Banks instead of fulfilling its mandate to balance inflation and unemployment.

So in other words, since you don't happen to like the policy decisions they've made, there must be some sort of criminal malfeasance afoot. :roll:

Ikari said:
And the Fed should not be 100% independent since it must belong to Congress.

The president appoints the Board of Governors of the Fed, with the advice and consent of the Senate. Congress can change this mandate at any time, subject to the president's veto. Ergo, the Fed is not 100% independent.

Ikari · May 17, 2010

Kandahar said:
No. They are NOT the same for the purpose of this discussion. No one has disputed that Congress has the POWER to audit the Fed. The dispute is whether or not it's a good idea. If your only rationale is "because they can," that's an absurd way to pursue policy.

No, it's not my argument, you must have missed the point. Congress owns the Fed, it can be no other way. Only Congress was given the power to print and regulate the value of our money. Thus any institution, such as the Fed, which sets the value of our currency is property of Congress. It's not that "because they can", it's that they are the only one's with the proper power and they must audit it. The Fed cannot be independent. You can say it should be isolated from the popular opinions which can influence Congress. Fine. But it cannot be 100% independent and be within the confines of the Constitution.

Kandahar said:
That is not the way Washington works. It doesn't matter what the investigation turns up, and there's no particular reason to suspect the Fed of any wrongdoing. The purpose of the audit is so that congressmen can run with whatever scraps they can turn up and use it to attack the Fed.

Imagine that you're the CEO of a big company. I launch an investigation (without any basis whatsoever) to determine whether or not you've embezzled money from the company, and I loudly tell the newspapers all about my investigation. Are you OK with that? After all, if you've done nothing wrong you have nothing to hide, right? The mere presence of congressional investigators breathing down the Fed's neck compromises its independence. And since there is no reasonable suspicion that the Fed has acted inappropriately, they should not launch the investigation in the first place.

There is always reason to suspect the Fed of wrong doing. It is a government agency, and the government was never meant to be a trusted entity. We have to audit, we have to look, we have to make sure that it is doing everything by the book by the powers vested in it by the Constitution. If you wait till the abuse becomes apparent, it's too late. Government must always be watched and constrained. And thus your analogy fails as you try to liken private enterprise and individual to government.

Kandahar said:
So in other words, since you don't happen to like the policy decisions they've made, there must be some sort of criminal malfeasance afoot. :roll:

Better safe than sorry when it comes to government power and improper use of it. You asked what could be discovered, I gave you one very possible way by which it could. Sorry if you didn't like it, but that's reality. It's why we have to watch the fed. We didn't separate powers because we felt it was cool to make government slow and reactive. We did so to ensure that no one branch gets too much power. This is because government is fundamentally untrustworthy. You can't put all the power into one branch because it will surely abuse it. So you make government obtuse, you make it slow, you make it reactive, and you ensure that no one branch can dominate the others. So too here. The Federal Reserve is a government entity which belongs solely to the Congress. It must be watched, because of the powers it wields it can't be a closed book. It's like if we could get no information on the bills and laws Congress was passing. Well of course that's a bad idea, we need to know what they are doing, why they are doing it.

Kandahar said:
The president appoints the Board of Governors of the Fed, with the advice and consent of the Senate. Congress can change this mandate at any time, subject to the president's veto. Ergo, the Fed is not 100% independent.

Damned straight it's not 100% independent. And because it is a duty and responsibility of Congress to maintain, it must be subjected to regular audits to ensure that it is falling within the Constitutionally granted powers of the Congress and we need to ensure that the practices are by the book, in the open, and available for scrutiny.

Senate votes 96-0 to audit Fed

Ikari

ricksfolly

danarhea

Slayer of the DP Newsbot

Kandahar

Enemy Combatant

Ikari