Ever since Ron Paul first introduced it in 2009, the "Federal Reserve Transparency" Act, calling for the elimination of the Federal Reserve System's exemption from certain kinds of GAO audits, has been the subject of vigorous debate between proponents of greater government accountability and champions of an independent Federal Reserve.
But that debate has for the most part produced more heat than light, with hyperbole on both sides obscuring rather than shedding light on the debate's central questions—questions like, "What could the proposed Fed Audits possibly reveal that existing audits and Fed testimony do not?," and "To what extent would such audits pose a threat to the Fed's independence?"
To get some honest answers to these questions, the Cato Institute's Center for Monetary and Financial Alternatives recently held a Policy Forum, "Should the GAO Audit the Fed?" The forum's participants, representing several important perspectives, were former GAO Comptroller General David Walker, Pulitzer Prize-winning author David Wessel, who also directs Brookings' Hutchins Center on Fiscal and Monetary Policy, and our very own Mark Calabria, Cato's director of Financial Regulation Studies.
Thanks to our participants' expertise and also to the seamless moderation of their remarks by Wall Street Journal reporter Josh Zumbrun, the event turned out to be the most informative discussion of the issue to date!
OK, so I'm not exactly an unbiased critic. But watch the video and see if you don't agree!
If this sample only leaves you yearning to hear more from these experts, check out Calabria's piece on the actual content of the bill and David Wessel's assessment of the motives behind and risks entailed in the proposed audits. For more on the GAO's perspective, finally, have a look at this David Walker article.