Eventually there was bound to be a reaction from liberal-left politicians to the Ron Paul-led effort to audit the Federal Reserve. That reaction appears to be taking shape in the form of Senator Chris Dodd's plan to create a super agency to oversee, especially now that the Dodd plan received front-page treatment from the New York Times on Sunday.

The Associated Press has reported that there is a consensus building in the Senate around Dodd's plan that would considerably weaken the power of the Federal Reserve by stripping it of it’s power to oversee banks, handing that job over to a “single federal bank regulator.” Dodd’s proposal would establish a council or panel of regulators with a so-called independent chairman who would make the decision as whether or not to intervene and save or dismantle a private company.

Dodd’s plan is seen as the equivalent of the Baucus bill in health care, so a caveat emptor may be in order here. “We clearly need to put in place an architecture that restores confidence and makes people feel that when they engage in financial activities, from making a bank deposit to buying insurance or investing in stock, that they can have confidence in the system,” Dodd opined.

Meanwhile, the top-ranking Republican on the bank panel, Sen. Richard Shelby, says he’s still reviewing options and has not yet endorsed Dodd’s plan. "If you look at the record here of the failure of the regulatory bodies, all roads seem to lead to the Federal Reserve," Shelby said, so at least he’s gotten that far. His constituents may want to contact him on this matter.

Peter Schiff, who is challenging Dodd for his Connecticut Senate seat, says, “As long as Fannie and Freddie and Congress are meddling with the economy, changing the structure of the regulators is basically rearranging deck chairs on the Titanic. Dodd’s proposal takes regulatory authority away from one unaccountable institution and gives it to another even bigger one. This will not solve our problems.”

And not just willing to criticize, Schiff offers practical solutions, adding: “Only by cutting deficit spending, reducing burdensome regulations, and letting people keep more of their hard-earned dollars will we get our economy back on track.”

In the House of Representatives, Barney Frank is also trying to muddy the waters by introducing a bill similar to Dodd’s that would also restructure the Fed as opposed to auditing it.

The better way forward is still to be found in Ron Paul's H.R. 1207. That bill is scheduled for floor debate Friday, September 25.

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Robert Boger said:

END THE BANKING CARTEL: There is NO question...the enemy is within. Dear All, There is no bill more important to the fate of the U.S. economy and with it the fate of the American people (read Labor and all workers who exchange 9-2-5 time for money) than HR-1207. You must understand exactly why the oligarch capitalist elite of both parties are terrorified of this bill – including those elite within the Democratic party. It will completely destroy their control and guidance on broad investment in the United States, and their duplicitous trades off that overseas, think labor arbitrage, etc. With the passing of HR-1207 and the eventual end of the Federal Reserve…investing PRIVATE EQUITY in the United States (not just buying our passive government bonds that does nothing for the American people) will be the greatest investment opportunity in over a 100 years. Waves of domestic and international capital post HR-1207 will stop buying our bonds (which is passive to the American people) and start investing EQUITY (which is positive for the American people) direct into America business and will result in the full reverse of our sky rocketing unemployment. It will be an economic reset as if it was the 1880s all over again. We will find ourselves on par with China and others in a way that will upset all American & Chinese globalists (though not European)…..and with it flush down the toilet a whole class of double-faced elites that want nothing more to hold us down where they can arbitrage the American peoples ignorance to the bitter end – which is exactly what is still going on. HR-1207 has broad bi-partisan support. There is NO QUESTION this bill can pass the House and Senate VETO proof. PLEASE CALL AND HARASS BARNEY FRANK AND OBAMA TO STOP STANDING IN THE WAY.

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