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A GOP-Controlled Senate Means Congress Could Audit the Fed in 2015

Created: 10 November, 2014
Updated: 15 October, 2022
2 min read

The midterm elections that benefited the Republican Party may also mean an audit of the Federal Reserve is one step closer to reality.

Outgoing Senate Majority Leader Harry Reid supported a Federal Reserve audit in the 1990s, and voiced support for one as recently as 2010. However, in 2012, Reid refused to bring any audit bills to a vote.

An audit the Fed bill was introduced in the last two Congresses by Kentucky U.S. Senator Rand Paul. Neither made it through committee, but with a power shift in the Senate and an ally leading the majority party, the political landscape may be more accommodating.

Polls in recent years have shown people increasingly concerned with the actions of the Federal Reserve. A 2013 Rasmussen poll found 74 percent of people polled wanted an audit of the central bank. Another poll in August found that 75 percent of respondents were anxious about inflation and questioned whether the Federal Reserve could keep it under control.

The Federal Reserve is already subject to

periodic, but incomplete audits. A partial audit in 2011 revealed $16 trillion in loans were made to foreign banks and corporations during the Great Recession.

An audit bill passed the House in September, 333-92. It marked back-to-back sessions the lower chamber passed an audit bill. A similar bill introduced by Ron Paul in 2009 died in committee despite over 300 cosponsors.

Rand Paul's fellow Kentucky senator, Mitch McConnell, is expected to become the Senate majority leader in January. For the first time in his 30-year career, McConnell faced a well-funded, viable primary opponent, Matt Bevin. However, the outsider challenge was partly headed off with Paul endorsing McConnell early in the race and actively campaigning for the senator throughout 2014.

McConnell's gratitude for Paul's work was evident shortly after the votes were counted. On Thursday, he announced, "I'm a big supporter of Rand Paul. We've developed a tight relationship, and I'm for him." On Paul's presidential aspirations, McConnell simply replied, "He'll be able to count on me."

Time will tell whether McConnell's effusion for his fellow Kentuckian extends to one of the Paul family's defining issues: auditing the Federal Reserve.

The change in Congress may mean the landscape is improving to the point that an audit the Fed bill can get through the Senate. The most recent Senate audit bill had only 31 cosponsors, but McConnell was one of them. Senator-elect Cory Gardner (R-Colo.) has indicated support for auditing the Federal Reserve. Other incoming senators Tom Cotton (R-Ark.) and Steve Daines (R-Mont.) also voted for H.R. 24, the House version that passed.

In 2015, politicos and voters will be able to see what type of strategist Mitch McConnell is. McConnell, who has been in the minority ever since he entered the leadership, has only organized his caucus in opposition. Although the White House is still controlled by Democrats, McConnell has the opportunity to begin organizing a positive agenda by getting the Senate to vote on auditing the Federal Reserve.