The Senator was speaking during the discussion of a recently introduced bill that would allow the President to appoint the Federal Reserve Inspector General.
Cynthia Lummis Rips Federal Reserve Over Lack of Transparency
Wyoming Senator Cynthia Lummis, also known as the “Crypto Queen,” delivered a blistering rebuke of the U.S. Federal Reserve on Friday, calling it “a giant black hole of unaccountability.” Her remarks came during discussions of a Senate bill that seeks to change how the central bank’s Inspector General is appointed.
Currently, the Fed Chair selects the Inspector General, who is responsible for oversight of the Federal Reserve System, but Lummis and others see this as a conflict of interest. “This is highly unusual,” Lummis explained. “And it means that the Inspector General has no independence.”
The new bill will shift appointment authority from the Fed Chair to the U.S. President. Lummis claims the central bank has become too insulated, powerful, and “comfortable.” “They are operating in the shadows,” Lummis said, citing the ongoing controversy over current Fed Chair Jerome Powell’s botched renovation project that will cost roughly $2.5 billion, including more than $700 million in budget overruns.
The rationale behind the Fed’s closed-door policy is mostly due to the need for independence from the whims of elected officials. A heavily partisan central bank would inevitably implement ineffective monetary policy tainted by the politics of the day. But Lummis argues that Fed independence is now being used as a cover for incompetence.
“They don’t even respond to FOIA requests,” Lummis said. FOIA requests involve asking for access to government data under the Freedom of Information Act (FOIA). “It’s become a giant black hole of unaccountability,” she added. “It’s time for change.”