On Wednesday the Full Committee passed 6 bills to provide transparency and accountability at the Federal Reserve, regulatory relief for the economy, and re-authorize the Native American Housing Assistance and Self-Determination Act.
The Federal Reserve Accountability and Transparency Act (H.R. 5018) is legislation developed as part of the Committee’s Federal Reserve Centennial Oversight Project launched at the end of last year. Under the bill, the Fed would adopt a more predictable rules-based policy -- of the Fed’s own choosing -- that leads to a healthier and stronger economy. The bill also requires the Fed to share with the public whatever rules-based approach it chooses to adopt. Additionally, H.R. 5018 requires the Fed to conduct a cost-benefit analysis in order to ensure that the benefits of proposed regulations outweigh the costs to the economy.
“The overwhelming weight of evidence is that monetary policy is at its best in maintaining stable prices and maximum employment when it follows a clear, predictable monetary policy rule,” said Financial Services Committee Chairman Jeb Hensarling (R-TX). “This legislation is about accountability and about transparency. It’s not about theory because history shows that when the Fed lets job creators, entrepreneurs, small business people and everyone else know how monetary policy will be conducted, the economy performs better and more people get to go to work.”
Capital Markets and Government Sponsored Enterprises Subcommittee Chairman Scott Garrett (R-NJ), a co-author of the bill, said H.R. 5018 takes “important steps toward establishing a more appropriate level of transparency at the Fed. As things stand now, the Fed’s regulatory activities take place behind a fraternity-like veil of secrecy, obstructing openness, and preventing proper accountability. And when it comes to monetary policy, like the Wizard of Oz, it’s time we bring the Fed out from behind the curtain.”
Rep. Bill Huizenga (R-MI), also a co-author of the bill, said H.R. 5018 will lift “the veil of secrecy surrounding the Fed by making it more open and transparent.”
In addition to H.R. 5018, the Committee also marked up four more pro-jobs bills that are designed to provide the economy with relief from Washington red tape.
"So far the committee has passed 38 different regulatory relief bills that will hopefully lead to smarter regulation and greater economic growth. Twenty of them have passed the House, many with bipartisan support. We hope to add at least five more to that list today. We look forward to the Senate actually doing anything, but we would particularly look forward to the Senate taking up some of this legislation," said Chairman Hensarling.
"Again, job number one will continue to be the creation of jobs and economic growth in this committee. These bills are designed to ensure just that," added Chairman Hensarling.
Subcommittee Investigates Discrimination and Retaliation at the CFPB
The Oversight and Investigations Subcommittee on Wednesday held a hearing to question CFPB Director Richard Cordray about allegations of discrimination and retaliation at the CFPB. Over the past several months, the Subcommittee has heard shocking testimony from whistleblowers, Bureau officials and an independent investigator on what has been described as a "hostile working environment" and "culture of intimidation and retaliation" at the CFPB.
"People are suffering and feel unprotected at their place of work and we've heard from them. [CFPB] managers have been given unequivocal free reign resulting in a toxic management culture that lacks accountability and trust. Employees fear speaking out and fear asserting their rights lest they suffer reprisals and retaliations. This must change," said Subcommittee Chairman Patrick McHenry (R-NC).
"The problems are much larger than some modifications to a performance management system. The problem is a CFPB management culture that condones intimidation, discrimination, and retaliation. And if the director has failed to reprimand and remove bad managers, then the problem is also his leadership or lack thereof," said Chairman McHenry.
Chairman McHenry also announced at the hearing that the Government Accountability Office (GAO) has agreed to probe the CFPB’s management practices and organizational culture. The GAO review was requested by Chairman Hensarling, Chairman McHenry and Chairman Shelley Moore Capito (R-WV) of the Financial Institutions and Consumer Credit Subcommittee.
MEMBER SPOTLIGHT
Rep. Bill Huizenga | Santelli Exchange: Fed reform
Rep. Huizenga and CNBC's Rick Santelli discuss the Federal Reserve Accountability and Transparency Act.
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