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Fed dodges bullet as House drops audit idea
Key Excerpts from Article on Website of Reuters News
Posted: June 20th, 2010
http://www.reuters.com/article/idUSN1527338120100615
The Federal Reserve scored a political victory ... as Democrats mulling financial reform backed off measures that would expose monetary policy to audits and make the head of the New York Fed a political appointee. The U.S. House of Representatives had approved a bill in December that included a provision, championed by Texas Representative Ron Paul, that would have opened the Fed's interest rate policy to congressional audits. But in a statement on Tuesday, House Democrats participating in negotiations over a final financial reform bill signaled a willingness to live with a narrower Senate audit provision that does not cover monetary policy. The Fed, which has admitted it was too complacent about regulatory oversight in the run-up to the global financial crisis, has come under heavy fire for being too close to the banks it regulates. The House Democrats also said they would try to defeat a plan contained in the Senate bill under debate that would allow the U.S. president to name the head of the New York Fed, a step that Fed officials have argued would undercut the central bank's political independence. The U.S. central bank appears to be emerging largely unscathed by the regulatory reform efforts. It successfully fought off a Senate push last month that would have stripped it of its oversight of smaller banks, and is poised to emerge as the most powerful financial regulator when reforms are complete.
Note: A news search on both Google and Yahoo revealed that MSNBC was the only media to pick up this Reuters story, yet MSNBC then removed the story. Why might that be?
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