By Ramsey Ramerman
One such string was contained in the Wall Street reform bill passed by Congress last year. An audit provision required the Federal Reserve to disclose that it loaned $9 trillion to private banks and corporations during the 2008-09 bailout — more than four times the United States’ annual tax revenue — including more than $1 trillion to foreign banks.
These are the taxpayers’ dollars, so taxpayers have a right to know how the Federal Reserve makes its decisions — all of its decisions, not just those made during the bailout. Last year more than 300 members of Congress co-sponsored Texas Rep. Ron Paul’s Audit the Fed legislation, a bill designed to make sure the taxpayers have this right. Paul has now re-introduced that bill, co-sponsored in the Senate by his son, newly elected Kentucky Sen. Rand Paul.
If the Federal Reserve was subject to Washington state’s Public Records Act and other open government laws, we would know exactly how it makes decisions, such as how much bailout money it should give Goldman Sachs or Greece or any other domestic or foreign entity. This is because Washington’s open government laws are at their strongest when government is spending money. While there are limited areas where the people’s interest is best served by confidentiality, it is always in the people’s interest to know how governments spend their money.
There are only five ways confidentiality can serve the public interest. While there are hundreds of exemptions to the Public Records Act, every exemption must (1) protect individuals’ privacy interests or (2) protect public safety interests or (3) preserve tax dollars or (4) protect private business interests or (5) make government more efficient. Moreover, when taxpayer dollars are being spent, the latter three interests never justify confidentiality — it will always be in the public’s right to know where their money goes.
Maintaining confidentiality at the Federal Reserve does not protect anyone’s personal privacy or make the public any safer, so there is no public benefit to confidentiality at the Fed. This does not mean there might not be some limited number of records at the Federal Reserve that should be kept out of the sunlight, but sunlight should always allow the public to see what banks got what funds from the Federal Reserve and why those banks got those funds.
Rep. Paul’s H.R. 1207, the original House version of the Audit the Fed bill, was part of the House’s version of the Wall Street Reform bill but was removed by the Senate and replaced with a one-time, limited audit. Without the full audit, decisions like whether to contribute billions of dollars to the International Monetary Fund for a European bailout continue to be made in darkness, exempt from transparency laws.
To paraphrase our state’s Public Records Act, the people of this country should not yield their sovereignty to the Federal Reserve which serves them. The people, in delegating authority to the Federal Reserve, should not give the Federal Reserve the right to decide what is good for the people to know and what is not good for them to know. The people should insist on remaining informed so that they may maintain control over the Federal Reserve that they have created.
Thus, the people should insist that their representatives support Ron Paul’s Audit the Fed bill.
Ramsey Ramerman is on the state’s Sunshine Committee, is the founding president of the Washington Association of Public Records, and is on the board of Public Eye Northwest, a nonprofit organization helping local governments be more transparent.