When Rep. Ron Paul introduced the Federal Reserve Transparency Act of 2009 (HR 1207), it was the latest in a line of pro-liberty, anti-big government laws that Paul had introduced. Unfortunately for the good old Fed, this one is gaining some steam. Now with 222 co-sponsors, it’s is pretty much going to make it through the House without a problem.
Unfortunately, many people feel that the government shouldn’t be involved in an audit of a private organization like the Federal Reserve Board. Unfortunately, the truth is that the Fed actually is governmental…sort of.
To start with, it’s important to understand that the Federal Reserve isn’t quite like any other organization out there. It operates privately, and has stock holders like a private corporation, but its governors are all Presidential appointees as if it’s a governmental agency. It’s even bound by the Freedom of Information Act, which a private entity isn’t. It’s difficult to explain that it’s both private and governmental, because really something can’t be both. Instead, think of it more as a hybrid entity.
With HR 1207, Rep. Ron Paul is trying to change one of the fundamental flaws in the Federal Reserve System, and that is the lack of anything approaching meaningful oversight.
You see, the Federal Reserve System answers to no one and reports, ultimately, to no one. Yet, at the same time, it can enter into agreements with foreign powers and is responsible for monetary policy for the entire United States banking system. It is the only organization termed as an independent agency of the United States government that has no oversight. The CIA, NASA, and the EPA all have to answer to congress, but not the Federal Reserve.
While Jeff might feel that Rep. Paul is wrong, I have to disagree with him. While I agree that the Federal Reserve’s authority needs to be removed and the Fed disbanded, that’s not going to happen. However, an audit of the agency that has law enforcement officers with arrest powers and who issues our currency doesn’t exactly seem out of line if you ask me.
We must remember that this is only a step, not the whole journey.
