Beyond Left Right
Jeremy Payne
October 7, 2009

The Federal Reserve is now truly scared of the momentum behind HR1207 and the public support it garners.  So much so that they have taken, what some believe to be, a new stance.  Last Thursday Bernanke said he welcomes a proposed 'council of regulators' to monitor risks to the entire financial system.  This is nothing more than spin.  The Fed is merely trying to co-opt the movement to audit them by acting as though they are in favor of new oversight.  Whatever the new inter-agency council of regulators turns out to be, rest assured it will be nothing more than a sham.  The Fed will be behind this new consumer protection body that would supposedly oversee them.  To quote Bernanke speaking to the House Financial Services Committee, “Our involvement in Supervision is critical for ensuring that we have the necessary expertise, information and authorities to carry out our essential functions as a central bank of promoting financial stability and making effective monetary policy.”

The Fed is seeking new expanded powers over essentially the entire economy and their proposal of a ‘council of regulators’ to help them monitor risk is being spun as if this would actually take some power from the Fed.  Thousands of Broadcast Reports and Articles are trying to push the ideas of: 
1. The ‘council of regulators’ will be the‘answer to our prayers’ and 
2. Would take some power from the Fed.

But as reported by Reuters: “While the administration has backed the idea of creating an inter-agency council to work with the Fed, it has been firm on its determination to place most power in the Fed.”  The proposed council has a valuable role to play in furthering the Fed’s agenda to control all financial institutions as they suck off the majority of the profits and tell us that’s Capitalism!

Audit the Fed
On September 25, 2009 the House Financial Services Committee began hearings on HR 1207: the Federal Reserve Transparency Act of 2009, which would require the Federal Reserve to open all it's books for a full audit by the Government Accountability Office. 

During the hearing, testimony was heard from both Austrian economist Tom Woods (.pdf), speaking in favor of the bill, and Scott Alvarez (.pdf), the general counsel for the Federal Reserve, who spoke against HR1207.  Scott argued that a bill such as HR1207 threatens ‘Fed Independence’, the Fed is already sufficiently accountable to Congress and that the current auditing policy is adequate.  Mr. Woods & Ron Paul countered these statements quite well.

THOMAS E. WOODS JR’s response:  “If there is any truth to the idea of Fed independence, it lay in precisely this: the Fed may reward favored friends and constituencies with trillions of dollars in various kinds of assistance, while keeping the public completely in the dark. If that is the independence we’re talking about, no self-respecting American would hesitate for a moment to challenge it.”

Ron Paul’s response:  “It has been argued that full disclosure of details of funding facilities like the Fed’s Term Asset- Backed Securities Loan Facility, or TALF, and the Primary Dealer Credit Facility, or PDCF, which enabled massive bailouts of Wall Street, would damage the financial position of those firms and destabilize the economy.”  In other words, if the American people knew how rotten the books were at those banks and how terribly they messed up, they would never willingly invest in them, and they would fail.
Failure is not an option for friends of the Fed. Therefore, the funds must be stolen from the people in the dark of night.  This is not how a free country works.  This is not how free markets work. That is crony corporatism and instead of being a force for economic stabilization, it totally undermines it.

If the Fed gave its actual arguments against a full audit, they would not have mentioned anything about political independence or economic stability.  Instead they would admit they don’t want to be audited because they enjoy their current situation too much.  Under the guise of currency control, they are able to help out powerful allies on Wall Street, in exchange for lucrative jobs or who-knows-what favors later on. An audit would expose the Fed as a massive fraud perpetrated on this country, enriching a privileged few bankers at the top of our economic food chain, and leaving the rest of us with massively devalued dollars which we are forced to use by law.  An audit would make people realize that, while Bernie Madoff defrauded a lot of investors for a lot of money, the Fed has defrauded every one of us by destroying the value of our money.

An honest and full accounting of how the money system really works in this country would mean that there is not much of a chance the American people would stand for it anymore.”

The First Step Towards a Solution for America’s Financial Crisis is to Audit the Fed. Then the American People will see where the money trail leads. Then we can work for a true monetary policy with a National currency based on wealth, rather than debt. You can help ensure this happens by contacting your Senators & tell them that you support a full Audit of the Federal Reserve, ASAP.