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Bernanke Stutters, Stammers And Shakes His Way Through
Questions On Audit The Fed Bill
Chairman's nerves show through when challenged on H.R.1207
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Federal Reserve chairman Ben Bernanke appeared incredibly nervous
during an interview aired last night on PBS' NewsHour, particularly
during a question on the ongoing effort to pass legislation
that would see the Fed's books being opened up to a general
audit.
In a display that will greatly encourage those
who continue for push for greater transparency of the privately
run Fed's actions, Bernanke stammered and stuttered his way
through the interview, his voice shaking as he attempted to
rail against calls to audit the Fed, reciting now familiar and
standard lines of propaganda.
"There's an effort in Congress, and in the
House in particular, to audit what the Federal Reserve does,
particularly in monetary policy. How do you feel about that?"
asked PBS' Jim Lehrer.
"So that bill, people don't fully understand
what that bill is about. It sounds like, audit the Fed, it sounds
like 'Let's look at the books.' That's what it sounds like."
Bernanke spluttered.
Clearly flustered and sounding very unconfident,
Bernanke continued:
"What people don't understand is that this
bill would give the GAO, the GAO, the authority to audit monetary
policy. And what does that mean? That means if the Federal Reserve
decided a year from now that because of incipient inflation
it was time to raise interest rates, that the Congress would
say, 'Ah, the GAO's going to audit that decision. It's going
to subpoena your materials. It's going to demand information
from members of the FOMC. It's going to evaluate your decision.
It's going to report to Congress.' I don't think that's consistent
with independence." Bernanke said.
Watch Bernanke respond to the question regarding
the bill:
Watch the entire PBS interview with Bernanke here.
(Article continues below)
Bernanke essentially repeated the very same mantra
he espoused during last week's Financial Services Committee
hearings, which was subsequently repeated in a Washington
Post editorial, claiming that the bill will hand
Congress the power to run monetary policy in the United States,
reducing the Fed's independence and politicizing decisions the
Fed makes.
However, as Senator
Bernie Sanders, sponsor of the Senate version of
Congressman Ron Paul's Federal Reserve Transparency Act, has
pointed out, "We must not equate 'independence' with secrecy"
where the Fed is concerned
"No matter how intelligent or well-intentioned
the Fed chairman and his staff may be, it isn't appropriate
to give a handful of people the power to lend an unlimited supply
of money to anyone it wants without sufficient oversight."
Sanders writes.
The bill would not give anyone in Congress or
elsewhere the authority to sit in on Fed hearings, thus it would
have no impact monetary policy. All it would do is provide answers
to the American people as to where trillions of dollars of their
money is disappearing to.
The legislation would simply amend existing law
to allow the Comptroller General of the General Accounting Office
to audit the Federal Reserve Board and its member banks.
As
CBS News’ Declan McCullagh points out, in
response to Bernanke's defense of the Fed:
“This is an odd claim. If you read the bill (H.R.1207),
it simply amends existing law to say “under regulations
of the Comptroller General, the Comptroller General shall audit”
the Federal Reserve Board and its member banks.”
"The Comptroller General is a Senate-confirmed
official who's also the head of the Government Accountability
Office (GAO), a legislative branch agency organized under the
U.S. Congress. In other words, we're not talking about a political
bomb-thrower, but a veteran civil servant tasked with important
oversight responsibilities." McCullagh explains.
Bernanke's claim that the GAO "already looks
at virtually all of our activities" is misleading to say
the least. There is no oversight whatsoever regarding loans
made by the Fed, which is why there has been no indication of
the final destination of multiple trillions of dollars in bailout
funds.
In addition, Federal Reserve meeting transcripts
are not made publicly available until five years after the meetings
occur.
As Ron
Paul himself explained to Bernanke last week,
the bill would do nothing to further politicize the Fed's decision
making given that the Fed is already overtly politicized anyway.
"Just the fact that they can issue a lot
of loans and special privileges to banks and corporations, that's
political. This idea that it would be political because we know
what happened afterwards just doesn't seem to add up."
Paul beseeched.
In our report
yesterday we detailed how Americans are turning
against the Federal Reserve, with just 30 per cent saying the
agency is doing a good job, compared with over 50% when the
question was last asked in 2003.
According to Gallup editor in chief Dr. Frank
Newport, “Americans are blaming to some degree the actions
or inactions of the Federal Reserve board” for the economic
turmoil.
Bernanke's doubtful PBS performance is sure to
increase the numbers of Americans demanding more accountability.
"...it was the sight of Ben Bernanke, quavering
before the audience, when I knew we were going to win this fight."
writes Adam de Angeli on Ron Paul's Campaign
for Liberty blog. "We're growing bigger and
better organized every day, while the banksters' last desperate
attempts to control the damage yield nothing."
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