http://thehill.com/blogs/on-the-money/ba...ouse-floor

Great stuff... Thanks for sharing

about damn time

Don't see how this doesn't pass. Seems entirely sensible and could also be easily used against someone this November and in the future.

Why is this seen as important? Do people suspect that the Fed overstated its earnings or that it misplaced some customer collateral? If this is about the Fed's role in the economy, why bother with an audit? The fact that we have fractional reserve banking system is hardly secret. While you sometimes have to wonder why the board chooses a target interest rate, whatever target they choose is reported by virtually all business media sources and the information that the board uses to make its decision is available right on their website. Inflation rates are meticulously tracked, and the basket of goods used to calculate the inflation rate is available. I would be shocked if the Mint did not publish the amount of cash they are printing. If they made any rule changes to encourage the housing bubble, they almost certainly appeared in the federal register or some equivalent mechanism. The 'scandal' of the Fed is not what they do behind closed doors, it is that nobody, not even those on the board, can be sure of what the short-term and long-term effects of the Fed's policies will be. It's not that their policies are secretive, it is that the way those policies interact with each other, the US economy, and the world economy is so complex, nobody can truly predict their effect.

(05-26-2012 01:07 AM)rice09 Wrote:  The fact that we have fractional reserve banking system is hardly secret. While you sometimes have to wonder why the board chooses a target interest rate, whatever target they choose is reported by virtually all business media sources and the information that the board uses to make its decision is available right on their website.

Why they make their decisions is more important than the decision itself. The WHY is precisely why you do an audit in the first place.

The Fed also doesn't publish in many instances who it lends money to. During the bailout the Fed gave out hundreds of billions in loans. You audit to discover who got those loans and under what terms to ensure there was no "inside baseball" going on. I'd bet my house that Goldman Sachs, because of its incestuous relationship with many at the Fed, got a honey of a deal on loans from the Fed.

Now I agree there needs to be a certain amount of secrecy in what the Fed does because decisions should be based on monetary policy, not politics. As we saw with the GM bailout, when politics gets involved it just screws everything up. However an audit and then report to Congress could still allow for a certain degree of discretion in what is reported.

Why not audit the Fed?

(05-26-2012 01:07 AM)rice09 Wrote:  Why is this seen as important? Do people suspect that the Fed overstated its earnings or that it misplaced some customer collateral? If this is about the Fed's role in the economy, why bother with an audit? The fact that we have fractional reserve banking system is hardly secret. While you sometimes have to wonder why the board chooses a target interest rate, whatever target they choose is reported by virtually all business media sources and the information that the board uses to make its decision is available right on their website. Inflation rates are meticulously tracked, and the basket of goods used to calculate the inflation rate is available. I would be shocked if the Mint did not publish the amount of cash they are printing. If they made any rule changes to encourage the housing bubble, they almost certainly appeared in the federal register or some equivalent mechanism. The 'scandal' of the Fed is not what they do behind closed doors, it is that nobody, not even those on the board, can be sure of what the short-term and long-term effects of the Fed's policies will be. It's not that their policies are secretive, it is that the way those policies interact with each other, the US economy, and the world economy is so complex, nobody can truly predict their effect.

But you're describing what the Fed is supposed to do. The purpose of an audit is to identify the things that they may be doing that they are not supposed to be doing. And since those things happen behind closed doors, who knows what they are at this point? There may be nothing, there may not, but either way we are better off knowing.

I personally think all major federal agencies should have full annual independent audits, just like publicly traded corporations. They should be held to some standard equivalent to Sarbanes-Oxley. Why should we trust a federal bureaucrat more than a corporate executive?

(05-26-2012 08:22 AM)Owl 69/70/75 Wrote:  

(05-26-2012 01:07 AM)rice09 Wrote:  Why is this seen as important? Do people suspect that the Fed overstated its earnings or that it misplaced some customer collateral? If this is about the Fed's role in the economy, why bother with an audit? The fact that we have fractional reserve banking system is hardly secret. While you sometimes have to wonder why the board chooses a target interest rate, whatever target they choose is reported by virtually all business media sources and the information that the board uses to make its decision is available right on their website. Inflation rates are meticulously tracked, and the basket of goods used to calculate the inflation rate is available. I would be shocked if the Mint did not publish the amount of cash they are printing. If they made any rule changes to encourage the housing bubble, they almost certainly appeared in the federal register or some equivalent mechanism. The 'scandal' of the Fed is not what they do behind closed doors, it is that nobody, not even those on the board, can be sure of what the short-term and long-term effects of the Fed's policies will be. It's not that their policies are secretive, it is that the way those policies interact with each other, the US economy, and the world economy is so complex, nobody can truly predict their effect.

But you're describing what the Fed is supposed to do. The purpose of an audit is to identify the things that they may be doing that they are not supposed to be doing. And since those things happen behind closed doors, who knows what they are at this point? There may be nothing, there may not, but either way we are better off knowing.

I personally think all major federal agencies should have full annual independent audits, just like publicly traded corporations. They should be held to some standard equivalent to Sarbanes-Oxley. Why should we trust a federal bureaucrat more than a corporate executive?

Based on history, I think it is safe to say you can trust corporations a lot more. There are exceptions, but almost all of those corporations don't exist anymore.

The Bill will die a quick death in the Reid controlled Senate, like all meaningful legislation.

With the no budget, no audit no nothing and the debt crisis, how can dims expect re election.

(05-26-2012 11:18 AM)SumOfAllFears Wrote:  With the no budget, no audit no nothing and the debt crisis, how can dims expect re election.

Stupid sheeple? Idealists?

(05-26-2012 01:07 AM)rice09 Wrote:  Why is this seen as important? Do people suspect that the Fed overstated its earnings or that it misplaced some customer collateral? If this is about the Fed's role in the economy, why bother with an audit? The fact that we have fractional reserve banking system is hardly secret. While you sometimes have to wonder why the board chooses a target interest rate, whatever target they choose is reported by virtually all business media sources and the information that the board uses to make its decision is available right on their website. Inflation rates are meticulously tracked, and the basket of goods used to calculate the inflation rate is available. I would be shocked if the Mint did not publish the amount of cash they are printing. If they made any rule changes to encourage the housing bubble, they almost certainly appeared in the federal register or some equivalent mechanism. The 'scandal' of the Fed is not what they do behind closed doors, it is that nobody, not even those on the board, can be sure of what the short-term and long-term effects of the Fed's policies will be. It's not that their policies are secretive, it is that the way those policies interact with each other, the US economy, and the world economy is so complex, nobody can truly predict their effect.

It is seen as important because Ron Paul says it is important.

(05-26-2012 08:22 AM)Owl 69/70/75 Wrote:  

(05-26-2012 01:07 AM)rice09 Wrote:  Why is this seen as important? Do people suspect that the Fed overstated its earnings or that it misplaced some customer collateral? If this is about the Fed's role in the economy, why bother with an audit? The fact that we have fractional reserve banking system is hardly secret. While you sometimes have to wonder why the board chooses a target interest rate, whatever target they choose is reported by virtually all business media sources and the information that the board uses to make its decision is available right on their website. Inflation rates are meticulously tracked, and the basket of goods used to calculate the inflation rate is available. I would be shocked if the Mint did not publish the amount of cash they are printing. If they made any rule changes to encourage the housing bubble, they almost certainly appeared in the federal register or some equivalent mechanism. The 'scandal' of the Fed is not what they do behind closed doors, it is that nobody, not even those on the board, can be sure of what the short-term and long-term effects of the Fed's policies will be. It's not that their policies are secretive, it is that the way those policies interact with each other, the US economy, and the world economy is so complex, nobody can truly predict their effect.

But you're describing what the Fed is supposed to do. The purpose of an audit is to identify the things that they may be doing that they are not supposed to be doing. And since those things happen behind closed doors, who knows what they are at this point? There may be nothing, there may not, but either way we are better off knowing.

I personally think all major federal agencies should have full annual independent audits, just like publicly traded corporations. They should be held to some standard equivalent to Sarbanes-Oxley. Why should we trust a federal bureaucrat more than a corporate executive?

Thanks, Ninerfan1 and Owl69/70/75 for the explanation! I do agree that all agencies should be audited every year, since it is always a good idea to verify that money is being spent and received as budgeted and that it is located in the expected accounts (accounting also tends to have a snowball effect in that a minor, innocent mistake can become a huge accounting headache later on if not caught or fixed). I wonder if an audit can actually turn-up the more interesting questions of why the board makes its decisions.

Since nobody really likes the Fed these days, I can't see how there could be opposition to this. If this bill does fail, I think the Republicans should try a bill that audits every agency. Given the embarrassment with the GSA (which to be fair, is neither party's fault), it would look really bad for the Democrats to kill such a bill. I could not even fathom their explanation for doing so.

(05-26-2012 12:51 PM)rice09 Wrote:  

(05-26-2012 08:22 AM)Owl 69/70/75 Wrote:  

(05-26-2012 01:07 AM)rice09 Wrote:  Why is this seen as important? Do people suspect that the Fed overstated its earnings or that it misplaced some customer collateral? If this is about the Fed's role in the economy, why bother with an audit? The fact that we have fractional reserve banking system is hardly secret. While you sometimes have to wonder why the board chooses a target interest rate, whatever target they choose is reported by virtually all business media sources and the information that the board uses to make its decision is available right on their website. Inflation rates are meticulously tracked, and the basket of goods used to calculate the inflation rate is available. I would be shocked if the Mint did not publish the amount of cash they are printing. If they made any rule changes to encourage the housing bubble, they almost certainly appeared in the federal register or some equivalent mechanism. The 'scandal' of the Fed is not what they do behind closed doors, it is that nobody, not even those on the board, can be sure of what the short-term and long-term effects of the Fed's policies will be. It's not that their policies are secretive, it is that the way those policies interact with each other, the US economy, and the world economy is so complex, nobody can truly predict their effect.

But you're describing what the Fed is supposed to do. The purpose of an audit is to identify the things that they may be doing that they are not supposed to be doing. And since those things happen behind closed doors, who knows what they are at this point? There may be nothing, there may not, but either way we are better off knowing.

I personally think all major federal agencies should have full annual independent audits, just like publicly traded corporations. They should be held to some standard equivalent to Sarbanes-Oxley. Why should we trust a federal bureaucrat more than a corporate executive?

Thanks, Ninerfan1 and Owl69/70/75 for the explanation! I do agree that all agencies should be audited every year, since it is always a good idea to verify that money is being spent and received as budgeted and that it is located in the expected accounts (accounting also tends to have a snowball effect in that a minor, innocent mistake can become a huge accounting headache later on if not caught or fixed). I wonder if an audit can actually turn-up the more interesting questions of why the board makes its decisions.

Since nobody really likes the Fed these days, I can't see how there could be opposition to this. If this bill does fail, I think the Republicans should try a bill that audits every agency. Given the embarrassment with the GSA (which to be fair, is neither party's fault), it would look really bad for the Democrats to kill such a bill. I could not even fathom their explanation for doing so.

No way in HELL would the righties do that. It would mean that the Pentagon would be audited. Btw, according to this article/Rep. Peter DeFazio, D-Ore, "In fact, under current law, the Pentagon is exempt from a federal law that requires all federal agencies to complete annual audits."(ie. that law seems to already exist)

http://www.oregonlive.com/politics/index...om_au.html

(05-26-2012 01:26 PM)RobertN Wrote:  No way in HELL would the righties do that. It would mean that the Pentagon would be audited.

More of your stupidity.

Conservatives have no problem with the Pentagon, and every other federal agency being audited.

(05-26-2012 02:58 PM)Ninerfan1 Wrote:  

(05-26-2012 01:26 PM)RobertN Wrote:  No way in HELL would the righties do that. It would mean that the Pentagon would be audited.

More of your stupidity.

Conservatives have no problem with the Pentagon, and every other federal agency being audited.

Liar.

(05-26-2012 03:21 PM)RobertN Wrote:  

(05-26-2012 02:58 PM)Ninerfan1 Wrote:  

(05-26-2012 01:26 PM)RobertN Wrote:  No way in HELL would the righties do that. It would mean that the Pentagon would be audited.

More of your stupidity.

Conservatives have no problem with the Pentagon, and every other federal agency being audited.

Liar.

When their quasi-business interests overlap military expenditures, you can bet your sweet bottom that (neo)conservatives will be fully against auditing key intelligence and military agencies.

Not necessarily a direct falsehood, but it is, in part, a lie.

(05-26-2012 04:59 PM)TampaKnight Wrote:  

(05-26-2012 03:21 PM)RobertN Wrote:  

(05-26-2012 02:58 PM)Ninerfan1 Wrote:  

(05-26-2012 01:26 PM)RobertN Wrote:  No way in HELL would the righties do that. It would mean that the Pentagon would be audited.

Conservatives have no problem with the Pentagon, and every other federal agency being audited.

Liar.

When their quasi-business interests overlap military expenditures, you can bet your sweet bottom that (neo)conservatives will be fully against auditing key intelligence and military agencies.

I would support a full, top-to-bottom audit of the Pentagon and the CIA just like the Fed and all the "domestic" agencies.

(05-26-2012 05:06 PM)Native Georgian Wrote:  

(05-26-2012 04:59 PM)TampaKnight Wrote:  

(05-26-2012 03:21 PM)RobertN Wrote:  

(05-26-2012 02:58 PM)Ninerfan1 Wrote:  

(05-26-2012 01:26 PM)RobertN Wrote:  No way in HELL would the righties do that. It would mean that the Pentagon would be audited.

Conservatives have no problem with the Pentagon, and every other federal agency being audited.

Liar.

When their quasi-business interests overlap military expenditures, you can bet your sweet bottom that (neo)conservatives will be fully against auditing key intelligence and military agencies.

I would support a full, top-to-bottom audit of the Pentagon and the CIA just like the Fed and all the "domestic" agencies.

I'm in.

The DoD is as susceptible to waste, theft, and graft as every other government agency, and should not be spared.

We want a clean government. Nobody is exempt.