Representatives Ron Paul (R-Tex.) and Alan Grayson (D-Fla.) sent a letter Wednesday to Senate Banking Committee Chair Chris Dodd (D-Conn.) asking first for the release of documents "that will allow the public and the Senate to have a full understanding of the commitments that the Federal Reserve has made on our behalf," the letter says.
The letter excoriates the Fed for lending financial institutions immense sums of money against overvalued collateral, a lack of clear lending standards and setting up holding companies with no-bid contracts. The decline in real income, along with rising unemployment and falling consumer asset prices, "raises real questions about Bernanke's tenure as Federal Reserve chairman," the letter says.
"Even as the (economic) crisis is said to be subsiding," the congressmen wrote, "we still do not have credit markets that are able to function without substantial government support, we have not addressed institutions that are 'too big to fail' which the Fed oversees (and) bank availability is again shrinking."
Paul and Grayson asked for the Fed to release documents regarding the Bear Stearns rescue, which institutions received $1.2 trillion in Federal Reserve funds, documents relating to Bank of America's merger with Merrill Lynch, off-balance sheet Fed transactions, and transcripts of all Open Market Meeting minutes.
While the House of Representatives has no say in the confirmation process, Paul and Grayson are working to bring more transparency to the Fed.
House Financial Services Chairman Barney Frank (D-Mass.) is supporting a measure Paul sponsored to create mandatory audits of the Federal Reserve. The legislation has 301 co-sponsors.
Grayson, who most recently won attention for his passionate remarks regarding health care, has become an online sensation as a result of his zealous nature, the New Republic reports. His questioning of Federal Reserve Inspector General Elizabeth Coleman has been viewed more than one million times on YouTube, TNR points out.