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

The Senate on Tuesday rejected Sen. Rand PaulRandal (Rand) Howard PaulThe Hill's 12:30 Report - Presented by ExxonMobil - World mourns the death of Prince Philip The Hill's Morning Report - Biden assails 'epidemic' of gun violence amid SC, Texas shootings Trump faces test of power with early endorsements 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 SandersHillicon Valley: Amazon wins union election — says 'our employees made the choice' On The Money: Biden .5T budget proposes major hike in social programs | GOP bashes border, policing provisions Overnight Defense: Biden proposes 3B defense budget | Criticism comes in from left and right | Pentagon moves toward new screening for extremists MORE (I-Vt.), another presidential candidate, voting in favor. Democratic Sen. Tammy BaldwinTammy Suzanne BaldwinMary Trump joining group that supports LGBTQ+ female candidates Johnson says leaving office after 2022 'probably my preference now' Democrats push Biden to include recurring payments in recovery package MORE (Wis.) backed the bill as well.

Sen. Marco RubioMarco Antonio RubioHillicon Valley: Amazon wins union election — says 'our employees made the choice' Overnight Defense: Biden proposes 3B defense budget | Criticism comes in from left and right | Pentagon moves toward new screening for extremists The growing threat of China's lawfare 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 CruzHarry Reid reacts to Boehner book excerpt: 'We didn't mince words' GOP lawmakers block Biden assistance to Palestinians Cruz on Boehner: 'I wear with pride his drunken, bloviated scorn' MORE (R-Texas) missed the vote. Sen. Bob CorkerRobert (Bob) Phillips CorkerSenate GOP faces retirement brain drain Roy Blunt won't run for Senate seat in 2022 It's time for Biden's Cuba MORE (Tenn.) was the only Republican to vote against the bill. 

Paul had pressured Sanders and Sen. Elizabeth WarrenElizabeth WarrenOn The Money: Biden .5T budget proposes major hike in social programs | GOP bashes border, policing provisions Overnight Defense: Biden proposes 3B defense budget | Criticism comes in from left and right | Pentagon moves toward new screening for extremists POW/MIA flag moved back atop White House 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 DurbinLawmakers say fixing border crisis is Biden's job Number of migrants detained at southern border reaches 15-year high: reports Grassley, Cornyn push for Senate border hearing 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 McConnellHarry Reid reacts to Boehner book excerpt: 'We didn't mince words' Democrats see opportunity in GOP feud with business Biden resists calls to give hard-hit states more vaccines than others 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 ReidHarry Reid reacts to Boehner book excerpt: 'We didn't mince words' The Memo: Biden seeks a secret weapon — GOP voters Tensions flare over Senate filibuster 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 BrownA bold fix for US international taxation of corporations Democrats offer competing tax ideas on Biden infrastructure Former Ohio health director won't run for Senate 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.