Watered Down “Audit” Bill Threatens Ron Paul’s Efforts to Audit the Federal Reserve

Show: Freedom Watch
Host: Judge Andrew Napolitano
Date: 10/21/2009


Judge Andrew Napolitano: Hello and welcome to Freedom Watch, your daily dose of raw liberty streaming live on FoxNews.com. I’m your Host Judge Andrew Napolitano, here defending freedom, defending your natural rights and defending your right to have a government that stays within the confines of the Constitution.

Congressman Ron Paul’s bill to audit the Federal Reserve is not only gaining enormous momentum, it’s being joined by additional legislation introduced by senators Jeff Merkley, Democrat of Oregon, and Bob Corker, Republican from Tennessee [S. 1803]. Ah, but their version waters down Congressman Paul’s bill, omits audits of important area of the Fed’s behavior and actually wipes out proper names of banks and other individuals. What kind of an audit is that?

While all this is going on, a so called conservative Republican Senator Lindsey Graham of South Carolina says he won’t let Congressman Paul “hijack the Republican Party”.

Here we go again, it is now my pleasure to introduce the object of Senator Graham’s wrath, one of American’s great defenders of freedom and liberty today, congressman Ron Paul joins us from our nation’s capital. He is, of course, the author of the New York Times bestseller “End the Fed”. Congressman Paul, welcome back to Freedom Watch.

Ron Paul: Thank you, judge, good to be with you.

Judge Andrew Napolitano: Thank you. I guess it was too good to be true to expect that a lot of liberal Democrats would be serious in their efforts of joining you and wanting to audit the Fed. What the heck are they trying to do in the Senate? What kind of an audit would it be if important parts of what the Fed does is not covered in the audit, and if they don’t give the proper names of the people with whom the Fed does business?

Ron Paul: It doesn’t do any good at all. I mean, maybe slight. But under the condition of canceling out what we’re doing? Yes, it would be quite harmful to us. But, you know, Corker, I believe a Republican is doing it and I wouldn’t write off all the Democrats in the House because they’re not running the show. I think what this is representing is the effort by the establishment, by Wall Street, by Goldman Sachs, by the Federal Reserve, saying “Look, let’s distract them from what a real audit would do.” And I think that is what is going on right now. But we will not back down. We’re going to demand that there be a full, honest audit on the Federal Reserve, or we shouldn’t accept it.

Judge Andrew Napolitano: You know, there are a couple of ways to look at this. I remember when you were a lone voice in the Congress, almost literally standing totally alone and arguing that we all need an audit of the Fed. You now have more than half of your colleagues on your side. That’s an enormous stride and it’s due totally to your single minded dedication and, I might add, explanations to your colleagues and to the country of the need for auditing the Fed. That’s the good side. The bad side is that they’re afraid of an audit and they’ve gotten their allies in Congress to try and water it down so it will look like they’re going along with the audit, but the fruits of their audit will be bitter and tasteless and dry and not revealing anything.

Ron Paul: That’s right, it would be a distraction if anybody becomes satisfied with this. I think the most important part of my bill and the one area that the Fed seems to be most resistant to is the opening up of the books of what they do with other governments, other central banks and international financial organizations. I think that’s where the real shenanigans go on and they don’t want to have any part of this. So they’re going to pretend that they’re going to open up these lending facilities to some degree and say, “Oh yeah, we’re finding out where this money went domestically”.

And maybe we will find out a little bit more information. But that won’t touch the foreign operations, because when you think about it when you can make a deal and promise money and loans to foreign central banks to get involved in the market and do some of your dirty work, I think they’re propping up markets and who knows what kind of mischief they’re involved in. So I think they’re very, very determined to stop what we’re trying to do and get these books open. But the more they obstruct the more they obstruct, the more attention we’re going to get and the more the people of this country will realize how necessary this audit is.

Judge Andrew Napolitano: Before I let you go, switching gears… what is Lindsey Graham worried about? What does he mean when he says “Ron Paul might hijack the Republican Party”?

Ron Paul: He’s sort of giving me a lot of credit, isn’t he? I can hijack the party? I’d like to influence the party. I’d like to suggest to them that they ought to follow up on what they claim they believe in. But this whole idea now… I guess he wants to have influence, too. But his views are quite different from mine. He supports Cap and Trade and he supports many big government programs. But he sees himself as a facilitator. He’s supposed to give half of the pie away, and if the Democrats want a program, he’ll give them 50% and he’ll claim this as a big victory.

So he’s approach is quite different, which he has a right to. But this idea that all of a sudden I am going to hijack the party? I think if you talk to the young people in this country who may well become the leaders of the country, and maybe Republicans, they ought to listen to what they are asking for. I don’t think it’s the policy of Lindsey Graham in any way whatsoever.

Judge Andrew Napolitano: Congressman Paul, it is always a pleasure. Thanks for joining us at freedom Watch.

Ron Paul: Thanks you.

  • Don Killoren

    End the Fed” is great! We need it NOW.


  • This so- called transparency bill is only my welfare for the Feds and Wall Street! Congressman paul Keep up the fight to make full transparency!

  • TJ

    H.R. 1207: Federal Reserve Transparency Act of 2009

    S 1803: Federal Reserve Accountability Act of 2009

    Makes sense why the bill in the Senate is different. It’s smack dab right in front of our face – look at the titles of these bills.

    The definition of transparency: the condition in which nothing is hidden. This is an essential condition for a free market in securities. Prices, the volume of trading, and factual information must be available to all.


    The definition of accountability: the allocation or acceptance of responsibility for actions


    Ron Paul is calling for transparency – nothing to be hidden. The people aren’t looking for fluffy, bits and pieces of information. We deserve to know the truth, the full truth. We want full transparency. Without transparency, is there really any accountability? Ron Paul, I have faith you will fight for full transparency and stick to the definition of the word.

  • Hardline

    Don’t be a part of any watered down bill.If such a bill is pased,then the Fed will claim victory in that they have passed the requirements of an audit.It would be better that there was no audit than a sham one,that maintains the status quo.It has to be all or nothing.