by Julianne LaJeunesse- University of New Mexico

Should the Federal Reserve Committee be regulated by the Government Accountability Office? U.S. Representative Ron Paul (R-Texas) says yes, and Scott G. Alvarez of the Federal Reserve says no.

Paul is the sponsor of H.R. 1207, which calls for audits on the Federal Reserve, a quasi-public entity that in theory can control the nation’s money supply, set interest rates, and implement monetary policy.

At a Friday hearing, Paul said the Fed needs GAO oversight because they aren’t doing their job correctly.

“The Federal Reserve was designed, and their mandate was to make sure that we have full employment, price stability, and stable interest rates,” Paul said. “In my lifetime, interest rates have been 21 percent and less than one percent- so they fail there. They [the Fed] want a stable dollar and stable prices… well, we have continuous inflation.”

Paul said it’s Congress’ responsibility to make sure the Fed does what it was created for and not buy into the idea that the Fed needs more power and more secrecy.

Fed Board of Governors General Counselor Scott G. Alvarez argued before Paul, Chairman Barney Frank (D-Mass.), and other members of the House Financial Services Committee, saying that Fed autonomy is instrumental in safeguarding U.S. interest rates, but also that an independent Fed is a nonpolitical Fed.

Alvarez said from an economic stance, GAO regulation would hinder Fed access to and implementation of some programs.

“If it looks like the Federal Reserve is changing directions because a statement [of] the policy review by another agency is influencing the Federal Reserve’s decision… then the integrity of the process will be undermined, confidence that the Federal Reserve will move in the direction that is best for the economy will be undermined, and we won’t be able to carry out our job as well,” Alvarez said. “And that’s what we’re concerned about.”

Alvarez said the Fed has taken many steps to increase transparency since the 2008 bank bailouts, but when Rep. Emanuel Cleaver II (D- Mo.) asked him about the misinterpretation between Congress and the Treasury Department and the Federal Reserve, as far as Troubled Assets Relief Program allocations, Alvarez said the latter departments decided to use the funds to restore confidence to banking institution, a decision Cleaver said was not immediately apparent when TARP was passed.

By Mariko Lamb-Talk Radio News Service

In a hearing with the Senate Finance Committee Tuesday, John Stephenson, Director of the Government Accountability Office (GAO) Environmental Protection Issues, Natural Resources and Environmental Team, outlined three options for the distribution of emission allowances for companies under a cap-and-trade program: auctioning revenue allowances, allocating free allowances to covered entities, or a combination of the two.

According to a preliminary report by the GAO, auctioning revenue allowances would enable the government to collect substantial revenues, create incentives for companies to lower emissions before the program starts, and level the playing field for covered entities. However, “auctioning does not by itself offer compensation to covered entities that could feel the greatest economic impact of the program,” Stephenson said.

The second option, allocating free allowances to covered entities, could “help build support for the program and ease the transition,” he said, but added that it may also potentially dampen incentives to decrease electricity use by businesses and households.

The third option, a combination of auctioning and free allocation, “may help compensate energy intensive industries,” noted Stephenson. A study by the Congressional Budget Office suggests that a 6% and 21% free allocation of allowances would fully compensate these industries.

According to the American Clean Energy and Security Act, passed by the House in June, 85% of emission allowances would be allocated by the government for free. Chairman of the Senate Finance Committee Max Baucus said, “whatever the approach, we need to devise a system that both meets environmental goals and passes political muster. That won’t be easy. The close vote in the House tells us that.”

“Let’s see if we can figure out how to distribute emission allowances in a way that one might call ‘just.’ Let’s see if we can figure out how to give all Americans what they deserve,” Chairman Baucus said.

The GAO will release a final report to the Senate Finance Committee later this year in preparation for a markup on a climate change bill later this year.

Jeff Ford, the Director for International Affairs and Trade at the U.S. Government Accountability Office, speaks about what the government agencies are doing to stop the gun trafficking in Mexico. (0:27)

 

 Standard Podcast [0:27m]: Play Now | Play in Popup | Download

By Aaron Richardson-Talk Radio News Service

The Government Accountability Office (GAO) recently released a report detailing the need for the U.S. to combat arms trafficking into Mexico.

Jeff Ford, the Director for International Affairs and Trade at the GAO outlined some of the steps the U.S. needs to take in order to find a solution.

“We talk in the report about the need to be able to trace the weapons that are seized by the Mexican government, to find out where they came from and also to get information to help develop cases and investigations of who might be smuggling these guns into Mexico,” said Ford during an interview with the Talk Radio News Service.

Ford stated that he was pleased the issue is finally getting the attention he believes it deserves.

“This strategy, that just came out two weeks ago, is the first one that we’ve seen that has a chapter in it that discusses the arms issue. So the very fact that they are recognizing that this is an important issue, that within its self is an important step forward,” Ford said.

Jeff Ford, the Director for International Affairs and Trade at the U.S. Government Accountability Office, says the Department of Homeland Security and other agencies have finally realized the importance of halting the illegal arms trade in Mexico (0:45)

 

 Standard Podcast [0:45m]: Play Now | Play in Popup | Download

Jeff Ford, Director for International Affairs and Trade at the U.S. Government Accountability Office, speaks about working with the Mexican government to trace illegal guns confiscated by the Mexican government. It is a step that is vital in fighting the illegal arms trade (0:23)

 

 Standard Podcast [0:23m]: Play Now | Play in Popup | Download

Acting Comptroller General Gene Dodaro of the Government Accountability Office discusses a reported recently issued by his office that judged the Treasury Department did not have a strategy to limit executive compensation or confirm that their spending complied with legislation (0:44).

 

 Standard Podcast: Play Now | Play in Popup | Download

Twenty to 50 million tons of electronic waste (e-waste) are exported worldwide said Rep. Diane Watson (D-Calif.) in a hearing today. Watson said it is possible to export these materials from the United States because this type of waste is exempt from export laws. According to Watson, “e-waste” pollutes water, air, and soil. She calls this development a “cyber-age nightmare.”

E-Waste is harmful because it contains dangerous toxins like lead and mercury, said Rep. Eni Faleomavaega (D-A.S.). It can be harmful for the United States as well because products we import “exposed to dangerous levels of toxins,” Faleomavaega continued. He said we have made developing countries a “dumping ground” for our “e-waste.”

The Government Accountability Office (GAO) found that the Environment Protection Agency’s enforcement in this area is not sufficient. Even though there were regulations for the export of cathode-ray tubes, a particularly hazardous type of e-waste, the GAO found that companies are easily circumventing these rules. John Stephenson, director of natural resources and environment issues at the GAO, said that the countries most affected by e-waste are Hong Kong, Vietnam, India, Singapore, and Pakistan. He called the exporting of e-waste a “public health issue.”

Rep. Eni Faleomavaega explains the problems from beginning to end regarding the export of e-waste. (0:45)

 

 Standard Podcast: Play Now | Play in Popup | Download

Over 1.6 million businesses owe more than $58 billion to Uncle Sam, according to Senator Carl Levin (D-Mich.) at a hearing before the Committee on Homeland Security and Governmental Affairs on unpaid payroll tax abuse. A study by the Government Accountability Office (GAO) concluded that more than half this debt is now uncollectible. (more…)