Rand Paul Files Bill He Claims Will Audit Fed – Instead Makes Congress Able To Crash Economy

If you listened to the right-wing blogosphere, Rand Paul’s new bill, S.294 was the end-all be-all of government actions this past week. The Ron Paul fans must be absolutely salivating at the call to audit the fed.

Of course the problem is that the Federal Reserve is audited on a regular basis by an independent, outside firm, with the audits verified by Congress. Which means, since the Federal Reserve is already audited, what, exactly, does Rand Paul’s bill do?

What the bill does is direct the Government Accountability Office (GAO) to audit the board of governors itself, which will then be issued in secret to the various members of Congress. No authorization for open documentation is given in the bill. There is also no indication as to what is being audited, which then means this is an audit of everything, work related or not. Their home life, the cars they drive, personal emails etc. A major intrusion of privacy. It also orders the comptroller to break international treaties by striking a provision of code which is required to keep the Federal Reserve in compliance for discussions with members of Congress and foreign ambassadors.

The most troubling is that the measure would strike an entire section authorizing audits of Federal Reserve Credit Facilities. It does not eliminate them, but it means that no longer would audits of the credit lines issued by the federal government be made available for the public to review. Without this, whole sections of the TARP package, of the automotive bailout, of energy industry lending, would be a huge black zone for any public review.

Why would Rand Paul do these two things, to bring the Federal Reserve board’s personal life under the microscope and to deliberately obfuscate the credit lines? This would enable congress to manipulate the monetary markets in a more direct manner. Since the information would be given to politicians in secret, it could then be effectively used against the board members. With the credit lines now hidden, congress can authorize loans to various private interest groups without a full accounting ever being put in to the public domain. Combine the two of these together, and the ability for Congress to manipulate our markets becomes trivial.

Welcome to the next Depression, a naked power grab by those who wish to see the system topple. As for the people who would be hurt by the next big crash? They should have been lucky enough to be born in the top 1%.