Thursday, May 7, 2015

InstaPoll: Audit the Fed and DOD

Congressman Randy Forbes



In its 102 year history, the Federal Reserve has never had a complete, independent audit. This is due to the fact that some of its operations are exempt from regular audits.

Congress established the Federal Reserve System in 1913 to add consistency to the economy after a series of financial panics brought instability to the banking industry. Since that point, the Federal Reserve has evolved in its governance and mission. Twice a year, the Federal Reserve Board must report to Congress on the economy and monetary policy in the United States. However, while the Government Accountability Office (GAO) is tasked with regularly reviewing the actions of the Federal Reserve, it is also prohibited under current law from including some information in its review.

Additionally, the Federal Reserve's budget is not subject to review by Congress.  According to the Congressional Research Service, unlike most other government agencies, the Federal Reserve is self-financing so there is no congressional oversight over its budget. Since its budget is not subject to the usual appropriations or authorization process, there is no regular avenue for Congress to ensure the Fed is allocating resources according to congressional priorities.

The Federal Reserve is led by a Board of Governors and these seven unelected, presidential appointed members guide the Fed's policy actions, serving 14-year terms. Since many of their actions are excluded from annual, comprehensive audits, they are privy to vast decision-making authority with little scrutiny.
This year, Congressman Randy Forbes has cosponsored the Federal Reserve Transparency Act (H.R.24) to audit the Federal Reserve, and recently sent a letter to Secretary of Defense Carter, requesting that the Secretary publicly outline his plan to make the Department of Defense auditable by 2017, and submit audit results to Congress by 2019, as required by the Financial Improvement and Audit Readiness Plan.

Question of the Week
: Do you support comprehensive audits of the Federal Reserve and Department of Defense?

(  ) Yes.
(  ) No.
(  ) I don't know.
(  ) Other.

Take the Poll here

Find the results of last week's InstaPoll here.


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