Toward a Fed Audit

It is tempting to express disappointment at the watering down the Senate did to Congressman Ron Paul’s vision of how to audit the Federal Reserve. Dr. Paul himself is, in an interview with the Sun this morning, characterizing the Senate’s bill as only “slightly better than nothing.” He is even warning, “It does political harm,” in that it gives the Fed “cover — and people can hide from it.” The bill that cleared the Senate is aimed at finding out merely what the Fed did during the recent bailouts but not what it is doing, say, at the discount window or in the way of loans to other central banks and governments and international financial institutions. It may lead to an auditing merely of procedures and not of numbers. The right move in the House-Senate conference is a pursuit of a wide audit that would open the Fed to daylight.