WASHINGTON, D.C. – Today, U.S. Senator Angus King (I-Maine) voted against a procedural motion to advance legislation that would compromise the independence of the Federal Reserve. After the vote, he released the following statement:

“This bill has nothing to do with auditing the Federal Reserve; in fact, the Fed is already subject to an extensive financial auditing process. The bill is really about inserting Congress into the Fed’s monetary policy deliberations under the guise of transparency. The name of the bill may sound good, but in reality, the legislation is anything but,” Senator King said. “And given Congress’ already abysmal record of meeting even its most basic obligations, it seems misguided to me that we would inject ourselves further into the day-to-day decisions of the central banking system. There’s simply no need to extend that dysfunction to the critical monetary decisions driving our economy, especially when there are already extensive accountability and transparency measures in place and when there is no evidence to suggest that congressional interference would improve America’s economic prospects.”

The legislation before the Senate today, known as the Federal Reserve Transparency Act, would direct the Government Accountability Office to review the certain operations and activities of the Federal Reserve System that, by law, are currently off-limits to the existing reviews. However, those long-standing restricted areas, which include transactions with a foreign government or central bank, deliberations or actions on monetary policy, and transactions directed by the Federal Open Market Committee (FOMC), exist to insulate the central banking system from political pressure or politically-motivated delays. Altering this well-established process, which provides transparency into the Federal Reserve’s inner workings while safeguarding the system’s independence, would impede the central banking system’s ability to make timely and important decisions about monetary policy and could ultimately harm the American economy.

A motion to proceed to the legislation ultimately failed with bipartisan opposition.

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