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

The Senate on Tuesday rejected Sen. Rand PaulRandal (Rand) Howard PaulA Senator Gary Johnson could be good not just for Libertarians, but for the Senate too Conservatives left frustrated as Congress passes big spending bills Senate approves 4B spending bill 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 SandersBernard (Bernie) SandersPoll: Gillum leads DeSantis by 5 points in Florida governor race Sanders: Kavanaugh accusers 'have risked their lives to come forward' Helping citizens unite in post-Citizens United America MORE (I-Vt.), another presidential candidate, voting in favor. Democratic Sen. Tammy BaldwinTammy Suzanne BaldwinConservative who's faced Kavanaugh accuser's lawyer calls her fair and reasonable Trump calls Kavanaugh accusations ‘totally political’ Dems seek to rebuild blue wall in Rust Belt contests MORE (Wis.) backed the bill as well.

Sen. Marco RubioMarco Antonio RubioJudd Gregg: Two ideas whose time has not come Nikki Haley: New York Times ‘knew the facts’ about curtains and still released story March For Our Lives founder leaves group, says he regrets trying to 'embarrass' Rubio 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 CruzBredesen says he won't back Schumer for Senate Dem leader Webb: The new mob: Anti-American Dems Ignored Latino vote will be key in future elections MORE (R-Texas) missed the vote. Sen. Bob CorkerRobert (Bob) Phillips CorkerBredesen says he won't back Schumer for Senate Dem leader GOP confidence grows on Kavanaugh Senate eyes Kavanaugh floor vote next week MORE (Tenn.) was the only Republican to vote against the bill. 

Paul had pressured Sanders and Sen. Elizabeth WarrenElizabeth Ann WarrenLawmakers unveil massive bipartisan bill aimed at fighting opioid crisis Dems push back on using federal funds to arm teachers Admiral defends record after coming under investigation in 'Fat Leonard' scandal 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 DurbinRichard (Dick) Joseph DurbinKavanaugh’s fate rests with Sen. Collins Amnesty International calls to halt Kavanaugh nomination Fox's Chris Wallace: All 10 Democratic Senate Judiciary members again declined interview invitations 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 McConnell GOP leaning toward Arizona sex crimes prosecutor to question Kavanaugh accuser: report GOP confidence grows on Kavanaugh Senate panel schedules Friday morning vote for Kavanaugh 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 ReidKavanaugh furor intensifies as calls for new testimony grow Dems can’t ‘Bork’ Kavanaugh, and have only themselves to blame Dem senator: Confidential documents would 'strongly bolster' argument against Kavanaugh's nomination 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 BrownSherrod Brown says he's 'not actively considering' running for president Election Countdown: Trump confident about midterms in Hill.TV interview | Kavanaugh controversy tests candidates | Sanders, Warren ponder if both can run | Super PACs spending big | Two states open general election voting Friday | Latest Senate polls Overnight Health Care: Senators target surprise medical bills | Group looks to allow Medicaid funds for substance abuse programs | FDA launches anti-vaping campaign for teens 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 FurmanTrump gets good news on wages On The Money: Trump waves off political risk from shutdown | Senate GOP, Dems get deal on major spending bill | Regulator to offer banking charters to financial tech firms | What to know from day one of Manafort trial American prosperity of Trump era marks real turning point in history 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.