WSJ: Taxpayers "Involuntary Investors" in Federal Reserve

Friday, September 18, 2009 9:38 AM by Mattie Duppler

CFA and ATR have been adamant supporters of the efforts to audit the federal reserve, and an op-ed in the WSJ today illustrates why a transparent fed is critical to the stability of the economy – Matthew Winkler points to the efforts on the part of the central bank to shroud its practices in secrecy over the past year as it has created and dispersed $2 trillion in taxpayer money under TARP. There are, however, several growing efforts to unmask the Federal Reserve’s secret use of taxpayer money. Bills have been introduced in both the House and the Senate that would create an online database of TARP disbursements, and CFA pledged support of these legislative efforts when they were introduced in the spring

Fortunately, the tide against the Fed’s opaque practices is already changing - last month Chief U.S. District Judge Loretta A. Preska in Manhattan ruled the Fed failed to satisfy the burden of proof regarding tangible effects of keeping its lending practices secret and ordered that the central bank release its lending records. If the decision is appealed, Winkler points out, this it the perfect opportunity for the Obama Administration to take a concrete stand on its lofty promises of transparency in government. An appeal would have to be made through the Solicitor General who reports to the President through Eric Holder. Allowing the District Court’s decision to stand would signal that the Obama Administration is serious about transparency, and not just when it is a convenient campaign promise.

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