When the Obama administration wants to kick in the teeth of every financial institution in sight, why is the White House now opposing a part of the financial reform legislation that would audit the Federal Reserve. After all, the Fed has had as much to do, if not more, than AIG and the other Wall Street punching bags.
Recently, the Federal Reserve has significantly altered the procedures and goals that it had followed for decades. It has more than doubled its balance sheet, paid interest to banks on reserves held as deposits with the Fed, made decisions about which institutions to prop up and which should be allowed to fail, invested in assets that expose taxpayers to large losses, and raised questions about how it will avoid inflation despite an unprecedented increase in the monetary base.
We should document why the Fed took each step, what the expected results were, and whether those results were achieved. What is surprising is not that many congressional colleagues support Rep. Ron Paul's (R-TX) bill calling for an audit of the Fed. Remarkably, there is significant opposition to such oversight, and the political prospects for undertaking such an audit are relatively bleak.
One reason why they're bleak is because White House Chief of Staff Rahm Emanuel, who made a pile of money working for a financial institution, is actively opposing the audit amendment. Here's the story, as reported by Ryan Grim, on the Huffington Post.