Today, the House Financial Services Committee passed an amendment to their financial regulatory reform bill that would mandate an audit of the Federal Reserve. The Paul-Grayson amendment, named for its chief sponsors, Reps. Ron Paul and Alan Grayson, passed the committee by a count of 43-26.
Supporters of the audit the Fed effort were concerned that a competing amendment by Mel Watt would gut whatever Paul-Grayson added in transparency to the Fed. After heated discussion today inside the committee, it appears that Paul and Grayson have won this round.
The bill has yet to reach the floor of the House. The Senate’s version of financial reform, written by Chris Dodd, also has a mechanism to audit the Fed, but that has not yet been marked up in the Senate Banking Committee.
…It should be noted that an overall final vote on financial regulatory reform from the Committee, expected today, was blocked, chiefly by members of the Congressional Black Caucus, panicked about having to take the vote at a time of double-digit unemployment.
(Rep. Barney) Frank told the panel that most of the members pushing him to postpone the vote were members of the Congressional Black Caucus who said that the political environment wasn’t right for a vote this afternoon.
“It’s my understanding,” Frank said, “that the issues being addressed are not internal to this bill.” In other words, the Democrats were not expressing particular problems with the bill itself, but the larger problems in the economy made them reluctant to support a bill that could be portrayed as too friendly to Wall Street.
This calls into question whether the House can finish work on the bill on schedule, by the second week of December.
UPDATE: OK, there’s something going on here. This comment shows the yeas and nays on the bill. If you check it, you’ll see that practically every member of the Congressional Black Caucus voted against the Paul-Grayson amendment.
CA-35 Rep. Maxine Waters nay, GA-13 Rep. David Scott yay, IN-07 Rep. Andre Carson nay, MN-05 Rep. Keith Ellison nay, MO-01 Rep. William Lacy Clay yay, MO-05 Rep. Emanuel Cleaver nay, NC-12 Rep. Melvin L. Watt nay, NY-06 Rep. Gregory W. Meeks nay, TX-09 Rep. Al Green nay, WI-04 Rep. Gwen Moore nay
That’s 8-2 against the amendment. At one level they’re backing up their member, Mel Watt.
However, right after the vote they all run to Barney Frank and tell him that they can’t vote for final passage of the bill because it might be seen as too industry-friendly? That’s a strange context for that, coming on the heels of a vote to audit the Federal Reserve and find out what they’re doing with trillions of dollars of taxpayer money.
(Rep. Barney) Frank told the panel that most of the members pushing him to postpone the vote were members of the Congressional Black Caucus who said that the political environment wasn’t right for a vote this afternoon.
That’s… interesting. I’ll try to dig something up in the morning.



31 Comments


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This is excellent news even if the majority of America doesn’t understand why. This is truly bipartisan. I really like Paul and Grayson and I like that they are working toward this common goal.
Keep up the pressure.
Yay Jane! Thank you for pushing back on this.
Mel Watts is dead to me.
Mel who?
A Less Than Opaque Look At Mel Watt’s Motivations To Kill The “Audit The Fed” Bill
Mel Watt
Watts it all about. . .alfie
Perhaps I should have dropped the “w” from my last comment.
Mel ho
watt a disgrace.
Looks like most of the Congress is for sale. I can just imagine lobbyists and CEO sitting around discussing what each one worth to them. Really shameful.
watt cho talkin bout willis?
There was Wattstaxx
I’m puzzled about Watt’s motivation. Looking at his fundraising this cycle it appears that his cash from the financial industry has actually dried up.
It seems more like they gave him lots in the past and now they are saying “times to pay the piper”. But Watts is in a reliably Democratic district so this sort of thing is more likely to backfire on him if his primaried.
Mel Watt is not going to be primaried. He was picked because he was the safest one on the committee to offer the amendment.
His office is having a little heartburn, but his seat is safe.
Will the Watt amendment be offered on the House floor? Should we be ready for that?
Watts district includes the corporate headquarters for Bank of America. TarHeelDem is right he was chosen to do this because he has a safe seat and would be amenable. Barney Frank was behind this. I can understand why a lot of Democrats would be scared to vote Frank’s financial reform bill. It is a sellout to the banks. The Fed audit amendment is about the only thing worthwhile in it.
There are so many things that I don’t know but why is it not a usual practice to audit the Fed? If I had ever thought about it – which I haven’t – I would have assumed that it was audited on a regular basis.
It’s pathetic, isn’t it?
Nope, remarkably, they’re printing trillions of dollars and nobody really knows how much or what they’re doing with it.
It’s been Grayson’s cause ever since he got to Congress. And Ron Paul’s for a lifetime.
During Tim Geitner’s hot-under-the-collar testimony today, he several times mentioned that the Fed was created by Congress, as if to shift responsibility for Fed actions onto the ‘critters questioning him. I wonder if he will come to regret today’s testimony.
I mean, if Congress created it, they should be able to audit it, right? It only makes sense.
It all goes back to its history and its curious status. It really is an extra-Constitutional creation. Some of the time it is supposed to oversee banks but it is essentially run by bankers for their own purposes. When it wants to dump liabilities on to taxpayers, it says it is a public entity. When it wants to hide what it’s doing, like taking crap securities on to its books, it claims it is private. Its secrecy is supposed to be part of its independence. But most of that independence has become illusory as it has become an extension of the Treasury. Now it operates kind of like a shadow budgeting authority, where the Congress has control of its purse and the President through the Fed has control of one of his own.
There are calls out now for the whole structure of the Fed to be re-examined. I agree. It is an opaque, dangerous, unConstitutional anachronism in our financial, economic, and political life.
Once again it was Republicans who were asking the tough questions of Geithner. Personally, I think Geithner should be in jail for what he did with Bear Stearns, Lehman, and AIG. But it makes me profoundly uncomfortable to have nutcase Republicans asking the questions that spineless Democrats should be asking. As in why doesn’t he resign?
Good Grief ! what a horror. I really didn’t know that absolutely no one has oversight at all. Hope Paul and Grayson prevail.
AL-06 Rep. Spencer Bachus yay
CA-12 Rep. Jackie Speier yay
CA-22 Rep. Kevin McCarthy yay
CA-27 Rep. Brad Sherman yay
CA-35 Rep. Maxine Waters nay
CA-40 Rep. Edward R. Royce yay
CA-42 Rep. Gary G. Miller nay
CA-43 Rep. Joe Baca nay
CA-48 Rep. John Campbell yay
CO-07 Rep. Ed Perlmutter yay
CT-04 Rep. Jim Himes nay
DE-01 Rep. Michael N. Castle yay
FL-08 Rep. Alan Grayson yay
FL-12 Rep. Adam Putnam yay
FL-15 Rep. Bill Posey yay
FL-22 Rep. Ron Klein nay
FL-24 Rep. Suzanne Kosmas
GA-06 Rep. Tom Price yay
GA-13 Rep. David Scott yay
ID-01 Rep. Walt Minnick yay
IL-04 Rep. Luis V. Gutierrez nay
IL-08 Rep. Melissa L. Bean nay
IL-13 Rep. Judy Biggert yay
IL-14 Rep. Bill Foster nay
IL-16 Rep. Donald A. Manzullo yay
IN-02 Rep. Joe Donnelly nay
IN-07 Rep. Andre Carson nay
KS-02 Rep. Lynn Jenkins yay
KS-03 Rep. Dennis Moore nay
MA-04 Rep. Barney Frank nay
MA-08 Rep. Michael E. Capuano nay
MA-09 Rep. Stephen F. Lynch nay
MI-09 Rep. Gary Peters yay
MI-11 Rep. Thaddeus McCotter yay
MN-03 Rep. Erik Paulsen yay
MN-05 Rep. Keith Ellison nay
MN-06 Rep. Michele Bachmann yay
MO-01 Rep. William Lacy Clay yay
MO-05 Rep. Emanuel Cleaver nay
MS-01 Rep. Travis Childers yay
NC-03 Rep. Walter B. Jones yay
NC-10 Rep. Patrick T. McHenry yay
NC-12 Rep. Melvin L. Watt nay
NC-13 Rep. Brad Miller nay
NH-02 Rep. Paul W. Hodes yay
NJ-03 Rep. John Adler yay
NJ-05 Rep. Scott Garrett yay
NJ-07 Rep. Leonard Lance yay
NY-03 Rep. Peter King yay
NY-04 Rep. Carolyn McCarthy yay
NY-05 Rep. Gary L. Ackerman nay
NY-06 Rep. Gregory W. Meeks nay
NY-12 Rep. Nydia M. Velázquez yay
NY-14 Rep. Carolyn B. Maloney nay
NY-25 Rep. Dan Maffei yay
NY-26 Rep. Christopher Lee yay
OH-01 Rep. Steve Driehaus yay
OH-06 Rep. Charles Wilson nay
OH-15 Rep. Mary Jo Kilroy nay
OK-03 Rep. Frank D. Lucas yay
PA-06 Rep. Jim Gerlach yay
PA-11 Rep. Paul E. Kanjorski
SC-03 Rep. J. Gresham Barrett yay
TX-05 Rep. Jeb Hensarling yay
TX-09 Rep. Al Green nay
TX-14 Rep. Ron Paul yay
TX-15 Rep. Rubén Hinojosa yay
TX-19 Rep. Randy Neugebauer yay
TX-24 Rep. Kenny Marchant yay
WI-04 Rep. Gwen Moore nay
WV-02 Rep. Shelley Moore Capito nay
Let the record reflect that Barney Frank is in the tank for Goldman Sachs and the financials.
Can’t believe Maxine Waters CA voted nay!!! Wonder what HER reasoning is.
And I didn’t see my CA rep Matsui in there . . . wonder how SHE voted . . .
Absolutely, but Bernie Sanders has Frank’s number and is calling it for what it is.
A shame a firebrand like Frank went south on this issue and sold out to his highest bidders.
He has to go for this.
The whole CBC voted no, backing up Watt. Then, the CBC asks for a delay on the bill. Hmmm….
The secret side is monetizing investment bank crap debt, but there’s so much of said crap that not even said Fed can make any significant difference to said banks holding said crap, and so, the dance of the zombie banks continues apace.
A link or something? I’d like to see what Sanders said re Frank’s vote. Tx
To be clear I don’t recognize a clear difference between the fed the treasury and the big finance companies. It’s the revolving door syndrome again. When Blankfein says GS alumni should go out and “do good” after they’ve made their pile at Goldman, what he really means is getting people with the same neolib ideology installed as counselors to power in governments, and in the international finance orgs like WTO, World Bank, IMF, etc. They really do work hard to ensure that no sensible alternative can emerge to the free lunch they currently enjoy.
They are also well ensconced in academia. Some call it “deep lobbying.” It is an important aspect of the Lord’s work.
Democrats Peter DeFazio and Maria Cantwell have also asked the question about why Geitner doesn’t resign.