Robert Auerbach, an economist to the Committee on Banking and Financial Services during the Arthur Burns, Paul Volcker, and Alan Greenspan chairmanships at the Fed, as well as being a Fed economist and now a professor at the University of Texas (Austin) has a bombshell revelation in his recent book Deception and Abuse at the Fed. He recounts how the struggle to make the Fed more transparent and accountable has much deeper roots than the mainstream media has let on, and those earlier fights revealed that the central bank hid the existence of original documents, namely FOMC transcripts, then destroyed them, and continues the practice of destroying the original records.
This chicanery means that what the GAO is auditing is not what the Fed does, but a simulacrum the Fed has served up, and a prettied-up one to boot.
In a Huffington Post article recapping some of the material in his book, Auerbach describes how the Democrats tried to make the Fed more accountable in the 1970s:
The Democrats tried to pass similar audit bills in the 1970s. The House Banking Committee (now called the Financial Services Committee) Chairman Henry Reuss, (1975 -1981, Democrat, Wisconsin) could not pass a GAO audit bill through his committee. That bill was then passed by the Government Reform Committee and became law in 1978 with substantial limitations…
In the 1970s, the Fed organized a massive lobbying campaign in the Congress against a GAO Fed audit, using officials from private banks they regulated Evidence of the Fed’s orchestration of the lobbying campaign came into public view after Reuss negotiated with Fed Chairman Arthur Burns for six months. Reuss obtained three years of transcripts from secret meetings of all twelve district Federal Reserve Banks in December 1976….
One example was: “On February 19, 1974, President Frank E. Morris of the Boston Federal Reserve Bank called on his board of directors to contact the members of Congress to promote the Federal Reserve’s position on an earlier version of the GAO audit bill.”
http://www.nakedcapitalism.com/2015/03/fed-impedes-gao-audits-destroying-source-documents.html
This chicanery means that what the GAO is auditing is not what the Fed does, but a simulacrum the Fed has served up, and a prettied-up one to boot.
In a Huffington Post article recapping some of the material in his book, Auerbach describes how the Democrats tried to make the Fed more accountable in the 1970s:
The Democrats tried to pass similar audit bills in the 1970s. The House Banking Committee (now called the Financial Services Committee) Chairman Henry Reuss, (1975 -1981, Democrat, Wisconsin) could not pass a GAO audit bill through his committee. That bill was then passed by the Government Reform Committee and became law in 1978 with substantial limitations…
In the 1970s, the Fed organized a massive lobbying campaign in the Congress against a GAO Fed audit, using officials from private banks they regulated Evidence of the Fed’s orchestration of the lobbying campaign came into public view after Reuss negotiated with Fed Chairman Arthur Burns for six months. Reuss obtained three years of transcripts from secret meetings of all twelve district Federal Reserve Banks in December 1976….
One example was: “On February 19, 1974, President Frank E. Morris of the Boston Federal Reserve Bank called on his board of directors to contact the members of Congress to promote the Federal Reserve’s position on an earlier version of the GAO audit bill.”
http://www.nakedcapitalism.com/2015/03/fed-impedes-gao-audits-destroying-source-documents.html
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