We Must End Fed Secrecy

I hope that the Senate will vote on my amendment to end secrecy at the Federal Reserve. I hope that as early as Tuesday, through the efforts of incredibly strong progressive and conservative grass-roots organizations, we will win a historic victory for the American people.

It's not going to be easy. It probably will require 60 votes for passage - a very high hurdle. That is why, in an important step forward, I reached agreement on Thursday with Chairman Dodd that absolutely keeps intact the key provisions we have been fighting for and hopefully will give us the additional votes that we need.

Under my amendment, for the first time the American people will know exactly who received more than $2 trillion in zero or near zero interest loans from the Federal Reserve and the exact terms of this assistance. A year ago, I asked Federal Reserve Chairman Ben Bernanke that question. He said he wasn't going to tell the American people. If we pass this bill, he will have to tell us.

For the first time, under this amendment, there would be a comprehensive top-to-bottom audit of the emergency actions that the Fed has taken since the financial crisis started. The amendment explicitly would require the Government Accountability Office (GAO) to investigate what many Americans believe were serious conflicts of interest involving the Fed and CEOs of the largest financial institutions in the country. For example, why was Goldman Sachs CEO Lloyd Blankfein at the New York Federal Reserve when the federal government decided to bailout AIG allowing Goldman to receive $13 billion?

In introducing a modified amendment, I addressed concerns that I heard from both Democrats and Republicans who did not want Congress to be involved in the day-to-day monetary policy of the Fed. I share that concern. That has always been my position. I believed that I had made it abundantly clear in the original amendment. Now we have made it even clearer.

Other changes in the amendment, which I do not consider significant, included setting a specific deadline - December 1, 2010 - for the Fed to make public the names of the financial institutions that received more than $2 trillion in what are now secret Fed loans. Also, we agreed - given that my interest was the recent, unprecedented activities of the Fed since 2007 - that the audit would cover the period since the economic crisis began and would be focused on the Fed's emergency provisions.

I support the legislation passed by the House of Representatives under the leadership of Congressmen Ron Paul and Alan Grayson. Frankly, some provisions in the House legislation are stronger than the language we have in the Senate. But there also are provisions in my amendment which are stronger than theirs, including a mandate that the names of financial institutions that received Fed loans, and the precise terms of the loans, will be made public.

My goal, as I conveyed to Congressmen Paul and Grayson when we talked on Friday, is to do everything that I can to pass this amendment in the Senate, and then to work with them for the strongest possible language in the final bill.