Senate rejects Paul’s push to audit the Fed
© Greg Nash

The Senate on Tuesday rejected Sen. Rand PaulRandal (Rand) Howard PaulOvernight Health Care: 50 million coronavirus vaccines given | Pfizer news | Biden health nominees Rand Paul criticized for questioning of transgender health nominee Haley isolated after Trump fallout MORE’s (R-Ky.) controversial proposal to audit the Federal Reserve, turning aside a bill that has drawn the ire of the business community and the White House. 

The Senate voted 53-44 on taking up the presidential hopeful’s measure. Sixty votes were needed to move forward.

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Paul won some bipartisan support for the legislation, with Sen. Bernie SandersBernie SandersOn The Money: Senators push for changes as chamber nears vote on .9T relief bill | Warren offers bill to create wealth tax Sanders vows to force vote on minimum wage No. 2 Senate Democrat shoots down overruling parliamentarian on minimum wage MORE (I-Vt.), another presidential candidate, voting in favor. Democratic Sen. Tammy BaldwinTammy Suzanne BaldwinBiden signs supply chain order after 'positive' meeting with lawmakers Democrats want businesses to help get LGBT bill across finish line Democrats offer resolution denouncing white supremacists ahead of Trump trial MORE (Wis.) backed the bill as well.

Sen. Marco RubioMarco Antonio RubioGOP senators question Amazon on removal of book about 'transgender moment' CPAC, all-in for Trump, is not what it used to be Watch live: Day 2 at CPAC MORE (R-Fla.), who is also running for president, supported moving forward with Paul’s legislation, while White House rival Sen. Ted CruzRafael (Ted) Edward CruzSupreme Court faces landmark challenge on voting rights Trump: 'I can't imagine' any Republican would beat me in 2024 primary if I run Poll shows most GOP voters back Trump 2024 bid MORE (R-Texas) missed the vote. Sen. Bob CorkerRobert (Bob) Phillips CorkerIt's time for Biden's Cuba GOP lawmaker patience runs thin with Trump tactics Former GOP senator: Republicans cannot let Trump's 'reckless' post-election claims stand MORE (Tenn.) was the only Republican to vote against the bill. 

Paul had pressured Sanders and Sen. Elizabeth WarrenElizabeth WarrenOn The Money: Senators push for changes as chamber nears vote on .9T relief bill | Warren offers bill to create wealth tax Sanders vows to force vote on minimum wage Warren's wealth tax would cost 100 richest Americans billion MORE (D-Mass.) to back his proposal, portraying it as a test of their commitment to taking on Wall Street.

“We’ve had a lot of Democrats who claim that they’re concerned about big banks and big banks controlling things and a revolving door between Wall Street and big banks and the Federal Reserve,” Paul told reporters during a conference call Monday. “We’ll see if any of those loud voices — Bernie Sanders, Elizabeth Warren — are they loud voices that really are for more oversight of the banking system?” 

Warren voted against the bill. 

Sanders, who in the past worked with Paul’s father, former Rep. Ron Paul (R-Texas), on similar “Audit the Fed” legislation, said the new bill would help build on his 2010 push to require an audit of the central bank’s emergency lending.

“Requiring the Government Accountability Office to conduct a full and independent audit of the Fed each and every year, would be an important step towards making the Federal Reserve a more democratic institution that is responsive to the needs of ordinary Americans rather than the billionaires on Wall Street,” the Independent senator said in a statement. 

Paul’s legislation, which would increase congressional oversight of the Fed and require it to undergo an audit by the Government Accountability Office, faced an uphill battle. Ahead of the vote, only 26 Republicans had signed on as co-sponsors.

Sen. Dick DurbinDick DurbinFBI director set for combative hearing on mob attack No. 2 Senate Democrat shoots down overruling parliamentarian on minimum wage Senate mulls changes to .9 trillion coronavirus bill MORE (D-Ill.) told The Hill while he expected the vote would be close, “at this point I think it’s going to be difficult for the Republicans to get 60 votes.”

Democrats suggested that Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellJudiciary Committee greenlights Garland's AG nomination This week: Senate takes up coronavirus relief after minimum wage setback Juan Williams: Hypocrisy runs riot in GOP MORE (R-Ky.), who supported the bill, was wasting floor time by making Paul’s legislation the first bill of 2016. McConnell backs Paul’s presidential run.

Senate Minority Leader Harry ReidHarry Mason ReidTrumpists' assaults on Republicans who refuse to drink the Kool-Aid will help Democrats The Jan. 6 case for ending the Senate filibuster Manchin flexes muscle in 50-50 Senate MORE (D-Nev.) dismissed Paul’s proposal as a “sham.”

“Republicans have been trying to undermine the Federal Reserve mandate to strive toward full employment,” he added on Tuesday morning.

Sen. Sherrod BrownSherrod Campbell BrownMedicare loophole for screening colonoscopies is fixed — What does this mean for patients? Republican Ohio Senate candidate calls on GOP rep to resign over impeachment vote Sunday shows - Trump's reemergence, COVID-19 vaccines and variants dominate MORE (D-Ohio), the ranking member of the Banking Committee, added ahead of the vote that the legislation “really solves nothing but to politicize the Fed.” 

For Paul, the vote in the Senate was a chance to grab the spotlight ahead of a weekend trip to New Hampshire, the second contest in the Republican primary.

After a promising start, he has struggled to break out in the field and is now coming in near the bottom of the polls. 

Fox Business Network announced that the Kentucky Republican didn’t qualify for the main-stage debate on Thursday night, and Paul has refused to participate in the earlier undercard bout.

Republicans broadly argue that recent policy decisions by the Federal Reserve — including its handling of the 2008 financial crisis — underscore the need for more oversight of the powerful central bank.

Sen. Pat Toomey (R-Pa.), who is up for reelection in November, said that while he had been skeptical of Paul’s legislation, “the dangerous behavior that the Fed has engaged in for years now means they have squandered the right to be independent.”

Sen. Richard Shelby (R-Ala.), the chairman of the Senate Banking Committee, had previously voiced opposition to Paul’s proposal, but voted Tuesday to move forward with it.

“I think we ought to debate it,” he told reporters on Monday evening. “I’m interested in oversight and that might be what he’s interested in.”

Federal Reserve officials have fought fiercely against Paul’s legislation, suggesting that it would allow Congress to weigh in on financial policy “in real time.”

Fed Chairwoman Janet Yellen sent a letter to Senate leadership late last week saying that she opposes the bill and warning, if signed into law, it could damage the economy.

The White House last year called Paul’s proposal “dangerous.”

“What that bill is about is about Congress supplanting its judgment as to what monetary policy should be,” said Jason FurmanJason FurmanBiden, like most new presidents, will get his shot at economics Our rebounding economy doesn't need more stimulus checks Republicans now 'shocked, shocked' that there's a deficit MORE, chairman of Obama’s Council of Economic Advisers. “Congress shouldn’t be telling the Fed what to do with monetary policy.”

Business groups had also expressed strong opposition to the bill.

The U.S. Chamber of Commerce, the most powerful industry lobby in Washington, issued an open letter urging senators to vote against the legislation, calling it “unnecessary.”

“Creating outside pressures that could politicize monetary policy decisions would likely harm the market foundations needed to fuel the free enterprise system,” wrote Bruce Josten, the Chamber’s executive vice president of government affairs.

Tuesdays’ vote was the first time Paul’s legislation was allowed to come up. 

Conservative groups rallied behind the measure, with FreedomWorks legislative affairs manager Josh Withrow saying late last week that if central banks “have nothing to hide from the American people, they shouldn’t fear transparency.”

This story was updated at 7:45 p.m.