Paulsen:  Let’s Audit the Fed

FOR IMMEDIATE RELEASE: September 25th, 2009

CONTACT: Andrew Foxwell (202) 225 - 2871

Today, Congressman Erik Paulsen, a freshman member of the Financial Services Committee, released the following statement in response to the hearing on H.R. 1207, the Federal Reserve Transparency Act, which would provide an audit of the Federal Reserve.

“I have strong concerns about the unprecedented levels of government spending that continues to be funded by the Federal Reserve purchasing Treasury issued debt – raising the issue that one government agency is buying the debt of another government agency.  The reality is that with all of these bailouts financed by the Federal Reserve it’s really the American taxpayer that is on the hook for this money.
                           
“The Fed continues to be the largest holder of U.S. debt at more than $4.75 trillion – 6 times the holdings of China.  Taxpayers are rightfully concerned about this enormous and largely unchecked power which should raise concerns about transparency and oversight.

“The balance sheet of the Fed has already skyrocketed from $850 billion in 2007 to $2.1 trillion today.  This massive expansion of taxpayer liabilities from the Fed’s activities and interventions require much more transparency than we are seeing now.

“Enactment of H.R.1207 would allow the Government Accountability Office (GAO) to conduct a full audit of all activities of the Federal Reserve Board and regional Reserve Banks.  Audits would give taxpayers and market participants a better understanding of the reasoning behind Fed policies. 

“I have heard loud and clear from my constituents on this issue and it's only reasonable that the Fed give a better report on what happens with their dollars.”

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