Congressman Ron Paul and 271 other members of Congress are demanding an investigation into the U.S. Federal Reserve system, igniting a battle between members of Congress and the American financial elite, who say auditing the Fed would result in “grave consequences”. The Federal Reserve is one of the most powerful financial institutions in the world, and many experts say, one of the most secretive. Ron Paul and other lawmakers say they won’t give up until they know for sure what the Fed is doing behind closed doors.
Channel: Russia Today
Reporter: Everyone loves money. But the U.S. Federal Reserve may be loving it a little too much and keeping it all to itself. Perhaps that’s why one of the hottest stories of the summer involves the Fed coming under fire. At the center of the heated debate is Congressman Ron Paul. He and about 263 members of Congress support a bill to audit one of the most powerful monetary institutions in the world.
Ron Paul: What I want to find out is what they’re doing. They can create money and create it out of thin air and make promises and guarantees to private entities, international bankers, other governments and other central banks. We deserve to know exactly what they’re doing.
Reporter: The Federal Reserve System is an organization with unprecedented financial power, heavily influencing the course of the U.S. economy and global financial system, and one that is supposed to operate independently of the U.S. government, or so we think.
And the eagle atop this massive marble structure in downtown Washington DC also oversees the regulation of interest rates and the printing of U.S. dollars.
Ron Paul: Now, because of what the Fed does, they’re embarking on a policy of destroying the value of the dollar. This could give capitalism a bad name. Obviously, this is not capitalism, this is cronyism and inflationism and secret central banking.
Reporter: Well, secret secrets are no fun unless we tell everyone. Lawmakers and economists agree that the Federal Reserve with its immense financial power, has exercised more control over the economy than any other government body. And if Congressman Ron Paul and others like him demand an investigation into this organization, the Fed itself says that the audit would only hurt, not help the economy.
Perhaps that’s why they have enlisted the help of over 180 economists and businessmen who have written a letter urging the U.S. government to “reaffirm their support for and defend the independence of the Federal Reserve System as a foundation of U.S. economy stability”. The Fed’s defenders say that the independence of U.S. monetary policy may be at risk.
Ron Paul: The Federal Reserve is hysterical over it. I mean, they’re sort of ganging up, getting all the economists to prove that transparency is terrible and they love the secrecy. They threaten that they’d raise interest rates and do all these terrible things.
Reporter: But the U.S. President seems to be on the side of this massive money machine.
A key component of Barack Obama’s financial overhaul is actually to give the Fed more power. What do you make of that?
Ron Paul: I said, “Look, if you do give them move authority that’s an even stronger argument for transparency, you just can’t keep giving them more and more power.” My argument is that if you’re against big government and you’re against centralized government and warmongering and welfarism, you can’t be for the Fed.
Reporter: Wars abroad and perhaps an even bigger battle brewing at home, one whose outcome could very well shake the financial system and get rid of the “don’t ask, don’t tell” policy that the Fed has become all too accustomed to… until now.