[Congressional Record (Bound Edition), Volume 161 (2015), Part 13]
[House]
[Pages 18451-18471]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              {time}  1730
           FED OVERSIGHT REFORM AND MODERNIZATION ACT OF 2015


                             General Leave

  Mr. HENSARLING. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days in which to revise and extend their remarks 
and submit extraneous materials on the bill, H.R. 3189, to amend the 
Federal Reserve Act to establish requirements for policy rules and 
blackout periods of the Federal Open Market Committee, to establish 
requirements for certain activities of the Board of Governors of the 
Federal Reserve System, and to amend title 31, United States Code, to 
reform the manner in which the Board of Governors of the Federal 
Reserve System is audited, and for other purposes.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  The SPEAKER pro tempore. Pursuant to House Resolution 529 and rule 
XVIII, the Chair declares the House in the Committee of the Whole House 
on the state of the Union for the consideration of the bill, H.R. 3189.
  The Chair appoints the gentleman from Kansas (Mr. Yoder) to preside 
over the Committee of the Whole.

                              {time}  1730


                     In the Committee of the Whole

  Accordingly, the House resolved itself into the Committee of the 
Whole House on the state of the Union for the consideration of the bill 
(H.R. 3189) to amend the Federal Reserve Act to establish requirements 
for policy rules

[[Page 18452]]

and blackout periods of the Federal Open Market Committee, to establish 
requirements for certain activities of the Board of Governors of the 
Federal Reserve System, and to amend title 31, United States Code, to 
reform the manner in which the Board of Governors of the Federal 
Reserve System is audited, and for other purposes, with Mr. Yoder in 
the chair.
  The Clerk read the title of the bill.
  The CHAIR. Pursuant to the rule, the bill is considered read the 
first time.
  The gentleman from Texas (Mr. Hensarling) and the gentlewoman from 
California (Ms. Waters) each will control 30 minutes.
  The Chair recognizes the gentleman from Texas.
  Mr. HENSARLING. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, I rise in strong support of H.R. 3189, the FORM Act, to 
reform the Federal Reserve. It is sponsored by the gentleman from 
Michigan (Mr. Huizenga).
  To paraphrase an old automobile advertising campaign, Mr. Chairman, 
this is not your father's Fed.
  Since the financial crisis, the Federal Reserve has morphed into a 
government institution whose unconventional activities and vastly 
expanded powers would hardly be recognized by those who drafted the 
original act. Regrettably, commensurate transparency and accountability 
have not followed.
  Since the financial meltdown of 2008, the Fed has carried out 
unprecedented rounds of asset purchases, known as quantitative easing; 
and its balance sheet has swollen to almost $5 trillion, equal to one-
fourth of the U.S. economy and almost five times its pre-crisis level.
  We have had almost 7 years of near-zero interest rates, and the Fed's 
so-called forward guidance provides almost no guidance to investors on 
when rates might finally be normalized.
  This ongoing uncertainty is a significant cause of businesses 
hoarding cash and postponing capital investments and community banks 
conserving capital and reducing lending.
  Adding to the economic uncertainty, the Dodd-Frank Act granted the 
Fed sweeping new regulatory powers to directly intervene in the 
operations of large financial institutions. This is totally separate 
and apart from its monetary policy responsibilities, Mr. Chairman.
  The Fed now stands at the center of Dodd-Frank's codification of too 
big to fail. With respect to these firms, the Fed is authorized to 
impose heightened prudential standards, including capital and liquidity 
requirements, risk management requirements, resolution planning, credit 
exposure report requirements, and concentration limits.
  The Fed is even authorized on a vague, faint finding that if a 
financial institution poses a grave threat to financial stability, to 
actually break up the firm.
  In other words, Mr. Chairman, the Fed can now literally occupy the 
boardrooms of the largest financial institutions in America and 
influence how they deploy capital.
  The Fed's monetary policy must be made clear and credible, and its 
regulatory activities must comport with the rule of law and bear public 
scrutiny. To accomplish this, the Fed Oversight Reform and 
Modernization Act, again, the FORM Act, authored by Congressman 
Huizenga, should be enacted into law.
  Reform accountability and transparency, on the one hand, and 
independence in the conduct of monetary policy, on the other, are not 
mutually exclusive concepts.
  The main reforms of the FORM Act are as follows: Number one, on 
monetary policy, the Fed must publish and explain with specificity the 
strategy it is following.
  The FORM Act allows the Fed to chose any monetary policy, strategy, 
or rule it prefers, and it has the power to amend or depart from that 
rule whenever the Fed decides economic circumstances so warrant.
  Whether the Fed chooses to conduct monetary policy based upon the 
Taylor rule developed by Stanford Economist John Taylor or whether they 
choose to conduct monetary policy based on a rousing game of rock-
paper-scissors or any other rule or method, the Fed will retain the 
unfettered discretion to do that.
  The FORM Act simply requires the Fed to report and explain its rule 
and its deviations from the standard benchmark to the rest of us.
  Economic history clearly shows that, when the Fed employs a more 
predictable, rules-based monetary policy, more positive economic 
results will occur.
  Some have opined that such a provision will compromise the Fed's 
monetary policy independence. It does not. The Fed again will retain 
unfettered discretion in the exercise of monetary policy.
  Given that members of the Fed Board of Governors enjoy 14-year terms, 
second only to lifetime judicial appointments, and the Fed's budget is 
independent of congressional appropriations, it is almost inconceivable 
that Congress could impose upon the Fed's monetary policy independence.
  On regulatory policy, as distinct from monetary policy, the format 
compels the Fed to conduct cost-benefit analysis for all its 
regulations. This is also known as common sense.
  Under Dodd-Frank, the Fed is directed to publish upwards of 60 new 
regulations, some in conjunction with other agencies, but a cost-
benefit analysis is not required. The Fed's failure to carry out these 
studies results in excessive regulatory burdens on our small banks and 
businesses, which harms the economy.
  Furthermore, under the FORM Act, the Fed will be required to issue 
formal regulations after providing for notice and comment for Dodd-
Frank stress test scenarios and disclose resubmitted stress tests.
  The Fed's authority to use stress tests to direct operations of 
financial institutions it deems systemically important puts government 
bureaucrats in a position of essentially dictating business models and 
operational objectives of private businesses. Yet, the Fed's 
implementation of stress testing is marked by a lack of transparency 
and a total disregard for the rule of law.
  Given the secrecy surrounding the stress test, it is difficult for 
Congress and the public to assess either the effectiveness of the Fed's 
regulatory oversight or the integrity of their findings.
  Again, under Dodd-Frank, vast powers have been expanded of the Fed. 
The Fed is not using a transparent monetary policy. Because of this, 
greater transparency, greater accountability is necessary. Otherwise, 
we may soon awake to discover that our central bankers have morphed 
into our central planners.
  Mr. Chairman, I reserve the balance of my time.
  Ms. MAXINE WATERS of California. Mr. Chairman, I yield myself 6 
minutes.
  Mr. Chairman, I rise today in strong opposition to H.R. 3189, a bill 
that would undermine the Federal Reserve's monetary policy 
independence, politicize its decisionmaking, curtail its ability to 
respond to a wide range of dynamic economic data, and weaken its 
ability to effectively carry out its regulatory responsibilities to 
promote the safety and soundness of our financial system.
  Mr. Chairman, H.R. 3189, the Fed Oversight Reform and Modernization 
Act, should more appropriately be called the Eliminate the Federal 
Reserve's Ability to Support the American Economy and Promote Full 
Employment Act.
  While no Federal agency is perfect and should be reflectively 
shielded from reform, this bill does not reflect a good faith effort to 
strengthen the Federal Reserve or hold it accountable to its mission, 
to keep inflation low and stable, and to promote full employment.
  Rather, this bill is designed to put monetary policy on autopilot 
under a strict, rules-based approach subject to reviews and audits by 
the GAO.
  This approach seeks to discourage monetary policymakers from 
considering the wide range of ever-changing economic data that is 
relevant to effective decisionmaking and would discourage the Fed from 
engaging in the

[[Page 18453]]

types of bold and forceful actions that have been so critical to our 
economy's recovery over the past 6 years.
  As the largest economy in the world that is increasingly 
interconnected to a vast and complex global economy, the notion that we 
should be putting blinders on our central bank strikes me as a recipe 
for disaster. In fact, had the Federal Reserve taken the approach 
called for in the underlying bill during and in response to the recent 
financial crisis, economic performance would have been substantially 
worse.
  As Federal Reserve Chair Janet Yellen put it in a letter to 
congressional leadership earlier this week, had the FOMC been compelled 
to operate under a simple policy rule for the past 6 years, the 
unemployment experience of that period would have been substantially 
more painful than it already was and inflation would have been even 
further below the FOMC's 2 percent objective.
  But the straitjacket approach to monetary policy isn't the only 
reason to oppose this bill. H.R. 3189 includes a host of provisions 
that represent the latest Republican effort to block financial 
regulators from fulfilling their responsibility to promote the safety 
and soundness of our financial system as part of the Dodd-Frank Act.
  In particular, this bill would impose unworkable cost-benefit 
analysis requirements that are designed to slow new rulemaking to a 
screeching halt and ensure the few that do get issued are tied up in 
court.
  The bill also requires the Federal Reserve to make public and solicit 
comments on its stress test scenarios, a move that, while popular with 
the biggest banks, would undermine the effectiveness of the test, 
turning this valuable regulatory tool for assessing the health of the 
financial system into a useless exercise.
  Finally, the Rules Committee print adds to the end of H.R. 3189 the 
text of H.R. 2912, a bill that would establish a partisan commission, 
with twice as many Republicans as Democrats, to review the Federal 
Reserve's conduct of monetary policy and recommend changes to its 
mandate as well as the specific instruments and operational regime to 
be used in achieving it.
  The fact is, the Federal Reserve's current dual mandate and 
operational monetary policy independence have served the economy well. 
Such independence ensures that policy decisions are empirically driven 
rather than motivated by short-term political pressures while its clear 
objectives allow Congress to hold it accountable.
  Operating under the current model, the Federal Reserve played a major 
role in ending the panic that gripped the financial sector in 2008 and, 
through its sustained efforts, has supported the creation of more than 
13.3 million private sector jobs and cut the unemployment rate in half 
since the height of the crisis, all while keeping inflation well below 
the target.
  Frankly, I think it is a terrible idea to put those who thought 
shutting down the government was a good idea and who thought fiscal 
austerity would grow the economy in a position to micromanage our 
monetary policy, also.
  Finally, I would be remiss if I failed to note that the Congressional 
Budget Office estimates that this bill will cost $109 million over 10 
years by forcing the Federal Reserve to jump through new rulemaking and 
administrative hoops.
  To pay for this cost, the Rules Committee adopted an amendment that 
would raid $60 billion from the Federal Reserve's surplus account, a 
buffer that inspires confidence in the central bank itself. Ironically, 
this is the very same fund that Republicans voted to eliminate just 2 
weeks ago.

                              {time}  1745

  For all of these reasons, I would urge Members to join me in opposing 
this terrible legislation that would do enormous damage to our economy 
and the American people. I can't believe this bill is before us.
  Mr. Chairman, I reserve the balance of my time.
  Mr. HENSARLING. Mr. Chairman, I yield such time as he may consume to 
the gentleman from Michigan (Mr. Huizenga), the author of the FORM Act 
and chairman of the Monetary Policy and Trade Subcommittee of the 
Financial Services Committee.
  Mr. HUIZENGA of Michigan. Mr. Chairman, I rise today in support of 
H.R. 3189, a wonderful bill called the Fed Oversight Reform and 
Modernization Act, the FORM Act.
  Mr. Chairman, Marriner Eccles, Chairman of the Federal Reserve under 
President Franklin Roosevelt, once began testimony to Congress by 
stating: ``I am speaking for the Board of Governors of the Federal 
Reserve System, an agency of Congress.''
  Chairman Eccles recognized what many seem to have forgotten over the 
Federal Reserve's 100-plus-year history, that the Fed was created by 
Congress; the Board of Governors are all appointed for terms of 14 
years by the President and confirmed by Congress; and it operates per 
its charter and laws set out by, yes, Congress. Therefore, the Federal 
Reserve is actually or, theoretically, is supposed to be accountable to 
Congress.
  Today, the Federal Reserve is one of the most powerful institutions 
in the world. It is past time to restore transparency at the Fed and 
hold it accountable to the American taxpayers.
  The U.S. Federal Reserve System, or the Fed, as it is known, was 
created in 1913 in response to a series of economic crises early in the 
20th century. Although the Fed was created as an independent agency 
deriving its power from Congress, over the past 100 years, the Fed's 
power has significantly expanded.
  While originally created to provide stability to the banking 
business, the Federal Reserve has gained unprecedented power, 
influence, and control over the financial system while remaining 
shrouded in mystery to the American people. At the same time, the 
American people have continued to suffer through a financial crisis, at 
least once per generation. With such a poor record, the Fed should not 
be free to carry on without accountability to the institution that 
created it.
  Mr. Chairman, we will not fully realize robust economic growth until 
the Fed changes the conduct of its monetary policy. Six years have 
passed since the recession officially ended, but the U.S. economic 
opportunity remains well short of its potential.
  The Fed must be accountable to the people's Representatives as well 
as to the hardworking taxpayers themselves. We need to modernize the 
Federal Reserve, restore accountability, and bring it into the 21st 
century. That is why I introduced H.R. 3189, the FORM Act of 2015. The 
FORM Act makes two fundamental changes to improve how the Federal 
Reserve conducts monetary policy.
  Now, I know my colleagues on the other side of the aisle tend to kind 
of like to pass bills before they know what is in those bills. That is 
one of the ways that they discover what is in those bills. But if they 
actually read this bill, they would see that it protects the Fed's 
ability to develop what it believes is the best course of action on 
monetary policy--the exact opposite of what my colleague was saying. It 
requires them to then give the American people a greater accounting of 
its actions.
  My bill directs the Federal Reserve to transparently communicate its 
monetary policy decisions to the American taxpayers--not what it must 
do, as is being asserted. Rather, they must simply explain what they 
are doing and why they are doing it. By requiring the Fed to regularly 
communicate how its policy choices compare to a benchmark guideline 
instead of continuing the ad hoc strategy currently being employed, the 
FORM Act will help consumers and investors make better decisions in 
both the present and create more sound expectations about the future.
  Even Chair Yellen once championed the merits of this approach, 
stating that ``the framework of a Taylor-type rule could help the 
Federal Reserve communicate to the public the rationale behind policy 
moves.'' The FORM Act does not dictate any particular monetary policy 
course; it simply ensures that the Fed transparently communicates its 
monetary policy decisions. I can't agree more with Chair Yellen.

[[Page 18454]]

  Second, the FORM Act reforms the Federal Reserve's emergency lending 
powers under section 13(3) of the Federal Reserve Act, closing a 
glaring loophole and preventing the likelihood of future bailouts, as 
we have seen in the past. During the last financial crisis, the Fed 
used extraordinarily broad powers to provide trillions of dollars in 
low-cost loans to a handful of massive financial institutions.
  The FORM Act raises the bar from the current trigger, permitting the 
Fed to invoke its emergency lending powers only upon finding that--and 
this is from the text of the bill--``unusual and exigent circumstances 
exist that pose a threat to the financial stability of the United 
States.''
  Responsibly limiting the Federal Reserve's lending authority has 
support from across the ideological spectrum, ranging from 
conservatives to liberals, such as Senator Elizabeth Warren.
  The FORM Act also does the following: It requires the Fed to conduct 
cost-benefit analysis for all regulations it promulgates. Failure to 
conduct cost-benefit analysis results in excessive regulatory burdens 
on small banks and businesses, which harm the economy and I believe 
have slowed our recovery.
  It also requires transparency about the Federal Reserve's bank stress 
tests as well as the international financial regulatory negotiations 
conducted by the Federal Reserve, the Treasury Department, the Office 
of the Comptroller of the Currency, the Securities and Exchange 
Commission, and the Federal Deposit Insurance Corporation.
  Mr. Chairman, I am afraid that we are sliding into a much broader 
area of regulation that is not U.S. regulation but is actually European 
and world regulation. It requires the Federal Reserve to review the 
salaries of highly paid employees. It provides for at least two staff 
positions to advise each member of the Board of Governors independent 
from the Chair, and it requires Fed employees to abide by the same 
ethical requirements as other Federal financial regulators.
  That sounds like an excellent idea in my mind.
  It clarifies the blackout period governing when Federal Reserve 
governors and employees may publicly speak to Congress as well as to 
the public on certain matters, and it ends automatic seats at the 
Federal Open Market Committee table, which provides a more balanced 
representation of votes on Federal policy at the FOMC.
  It requires the full FOMC to decide policy rates on excess balances 
maintained at a Federal Reserve Bank by a depository institution. It 
removes restrictions placed on the Government Accountability Office's 
ability to audit the Fed, and it directs the GAO to conduct an audit of 
the Fed within 12 months of enactment and report back to Congress.
  Finally, the FORM Act establishes a bipartisan monetary commission, 
as proposed by Chairman Brady, to identify other opportunities for 
improvement.
  Mr. Chairman, we can no longer afford to have an entity with so much 
power as the Federal Reserve by operating on a whim with ad hoc policy. 
The reforms in this legislation strike the right balance between 
holding the Fed accountable to Congress and the American people while 
still affording it its independence to make monetary policy decisions 
free from political pressure of all stripes.
  Mr. Chairman, the Federal Reserve System is an agency of Congress. As 
such, it is not infallible, and its independence should not be 
unlimited. Let's restore proper congressional supervision and provide 
the American people with transparency. I urge my colleagues to vote in 
support of H.R. 3189, the Fed Oversight Reform and Modernization Act of 
2015.
  Ms. MAXINE WATERS of California. Mr. Chairman, despite what my 
colleague on the opposite side of the aisle, Mr. Huizenga, has said 
about our not knowing what is in the bill, we know what is in the bill, 
and this Congress should be frightened about what you are attempting to 
do with establishing this simple monetary policy rule that is 
unworkable. This is dangerous.
  Mr. Chairman, I yield 4 minutes to the gentlewoman from New York 
(Mrs. Carolyn B. Maloney). She is the ranking member of the 
subcommittee on Capital Markets and Government Sponsored Enterprises of 
the Financial Services Committee.
  Mrs. CAROLYN B. MALONEY of New York. I thank the gentlewoman for 
yielding and for her leadership.
  Mr. Chairman, I rise today in opposition to H.R. 3189.
  Mr. Chairman, I include in the Record an article from The Wall Street 
Journal written by Alan Blinder, a former Vice Chair of the Federal 
Reserve, a professor at Princeton, and the author of a book on the 
financial crisis, the response, and the work ahead. This is his strong 
article in opposition to this bill which he feels is extremely 
disruptive, problematic, and just plain wrong.

             [From the Wall Street Journal, July 17, 2014]

                     An Unnecessary Fix for the Fed

                          (By Alan S. Blinder)

       The House Financial Services Committee held a hearing on 
     Federal Reserve reform on July 10. The hearing didn't get 
     much press attention. But it was remarkable. While the House 
     can't manage to engage on important issues like tax reform, 
     immigration reform and the minimum wage, it's more than 
     willing to propose radical ``reform'' of one of the few 
     national policies that is working well.
       The bill under consideration is called the Federal Reserve 
     Accountability and Transparency Act. (That's right: FRAT.) To 
     be fair to an otherwise dreadful bill, accountability and 
     transparency are worthy objectives, and FRAT does include 
     some reasonable ideas, such as trimming the news blackouts 
     before and after meetings of the Federal Open Market 
     Committee. But it also includes some corkers, such as 
     requiring public disclosures--in advance--before entering 
     into international negotiations, disclosures that could make 
     such negotiations next to impossible. How would you like to 
     play your poker hand open?
       But the meat-and-potatoes of the House bill has little to 
     do with either transparency or accountability. Instead, it 
     seeks to intrude on the Fed's ability to conduct an 
     independent monetary policy, free of political interference.
       As the title of Section 2 puts it, FRAT would impose 
     ``Requirements for Policy Rules of the Federal Open Market 
     Committee.'' A ``rule'' in this context means a precise set 
     of instructions--often a mathematical formula--that tells the 
     Fed how to set monetary policy. Strictly speaking, with such 
     a rule in place, you don't need a committee to make 
     decisions--or even a human being. A handheld calculator will 
     do.
       In the debate over such rules, two have attracted the most 
     attention. More than 50 years ago, Milton Friedman famously 
     urged the Fed to keep the money supply growing at a constant 
     rate--say, 4% or 5% per year--rather than varying money 
     growth to influence inflation or unemployment.
       About two decades ago, Stanford economist John Taylor began 
     plumping for a different sort of rule, one which forces 
     monetary policy to respond to changes in the economy--but 
     mechanically, in ways that can be programmed into a computer. 
     While hundreds of ``Taylor rules'' have been considered over 
     the years, FRAT would inscribe Mr. Taylor's original 1993 
     version into law as the ``Reference Policy Rule.'' The law 
     would require the Fed to pick a rule, and if their choice 
     differed substantially from the Reference Policy Rule, it 
     would have to explain why. All this would be subject to audit 
     by the Government Accountability Office (GAO), with prompt 
     reporting to Congress.
       In a town like Washington, the message to the Fed would be 
     clear: Depart from the original Taylor rule at your peril. 
     Federal Reserve Chair Janet Yellen understands this and, as 
     she made clear in her semiannual testimony to the House 
     Financial Services Committee on Wednesday, opposes the bill.
       So what is this rule that FRAT would turn into holy writ? 
     It's a simple equation, which starts by establishing a 
     baseline federal-funds rate that is two percentage points 
     higher than inflation; that's about 3.5% now. It then adds to 
     that baseline one-half of the amount by which inflation 
     exceeds its 2% target (that ``excess'' is now roughly minus 
     0.5%). Next, it adds one-half the percentage amount by which 
     gross domestic product exceeds an estimate of potential GDP 
     (that gap is controversial but is perhaps minus 4% today). 
     Thus Taylor's mechanical rule wants the current fed-funds 
     rate to be about 3.5 - 0.25 - 2.0 = 1.25%--which is vastly 
     higher than the actual near-zero rate.
       Fed staff could no doubt concoct an alternative rule that 
     instructed the FOMC to set the fed-funds rate close to zero 
     today, and the committee could pretend it was using that 
     rule. That's transparency?
       But there is a deeper problem. The Fed has not used the 
     fed-funds rate as its principal monetary policy instrument 
     since it hit (almost) zero in December 2008. Instead, its two 
     main policy instruments have been ``quantitative easing,'' 
     which is now ending, and ``forward guidance,'' which means 
     guiding

[[Page 18455]]

     markets by using words to describe future policy intentions. 
     If words are the Fed's main policy instrument, how is the 
     FOMC supposed to set them according to a rule? And how can 
     the GAO determine whether that rule resembles the ``Reference 
     Policy Rule''?
       The Taylor rule probably would give the Fed sensible 
     instructions in normal times. But what about when the world 
     is far from normal? The Fed claimed to be using Friedman's 
     money growth rule during the tumultuous disinflation of 1979-
     82--with miserable results. Luckily for all of us, the Taylor 
     rule wasn't tried during the 2008-09 financial crisis. That 
     could have been disastrous, effectively tying the Fed's hands 
     just when extraordinary monetary stimulus was most needed. 
     Should we now bet the ranch that the world will remain placid 
     forever?
       Conservatives distrust concentrated government power--an 
     idea embraced by our Constitution. They worry that human 
     beings, who are fallible and maybe not even trustworthy, will 
     make poor policy choices. Yes, to err is human. But humans 
     can often recognize extraordinary events and try to adapt. 
     Mechanical rules can't.
       There is another conservative principle in which I've 
     always believed: If it ain't broke, don't fix it. Monetary 
     policy is one of the few things in today's Washington that 
     ``ain't broke.'' The mischievous FRAT wouldn't fix it.

  Mrs. CAROLYN B. MALONEY of New York. Mr. Chairman, this bill would 
significantly undermine the Federal Reserve's independence by requiring 
the Fed to adopt a rules-based approach to monetary policy. While it is 
true that this bill doesn't force, by law, the Fed to follow a 
particular formula for interest rates, it does attempt to bully the Fed 
into following the Republicans' preferred monetary policy by hauling 
the Fed Chair up to testify in front of Congress every time the Fed 
deviates from the monetary policy rule dictated by this statute. This 
would have a significant chilling and killing effect on the Fed's 
deliberations over interest rates and inappropriately interferes with 
the Federal Reserve's independence.
  Let's also remember that the Taylor rule, which this bill would 
codify, would have performed disastrously in the financial crisis that 
we are still suffering from. Federal Reserve Chair Yellen testified 
that, during the crisis, the Taylor rule ``would have performed just 
miserably'' and would have led to a ``dreadful'' economic recovery.
  But this is not the only troubling provision in this bill. Section 4 
of the bill also needlessly overhauls the membership of the Federal 
Open Market Committee, or FOMC. The current makeup of the FOMC, which 
is responsible for setting monetary policy, has served this country 
well for the past 100 years. So if it isn't broken, don't try to fix 
it, and in this case, don't make it worse.
  The New York Fed is responsible for implementing monetary policy; and 
this special role gives the New York Fed a unique understanding of 
monetary policy, of how markets will react to changes, and what actions 
are both feasible and effective.
  I think that it is important to remember why the regional Fed 
president, with responsibility for implementing monetary policy, serves 
as the Vice Chairman of the FOMC.
  Mr. Chairman, monetary policy does not end when the FOMC announces a 
target interest rate. Short-term interest rates do not magically move 
to the FOMC's desired level. It is not that easy. Someone has to 
implement monetary policy by pushing short-term interest rates toward 
the official target rate, and that someone is the New York Fed.
  As Richmond Fed President Jeff Lacker said just last week, raising 
interest rates is ``pretty clear. You just write the statement and you 
must send it to'' the New York Fed in New York. The New York Fed does 
this primarily by buying and selling Treasury securities in the 
markets, which influences the supply of money in the system. Because 
the interest rate is a function of the supply and demand for money, the 
New York Fed controls short-term interest rates by influencing the 
supply of money in the system. This is an incredibly important job.
  The CHAIR. The time of the gentlewoman has expired.
  Ms. MAXINE WATERS of California. Mr. Chairman, I yield the 
gentlewoman an additional 30 seconds.
  Mrs. CAROLYN B. MALONEY of New York. The Fed's ability to control 
short-term interest rates is what allows the Fed to set monetary 
policy. If the markets didn't believe that the Fed had the ability to 
control short-term interest rates, then the FOMC's statement about 
raising or lowering interest rates would be viewed as merely wishful 
thinking rather than an actual monetary policy.
  Mr. Chairman, this is why the New York Fed president serves as the 
Vice Chair of the FOMC, and I see no reason why this should change. So 
it is unclear what this problem is trying to fix, and I urge my 
colleagues to vote against this bill.
  Mr. HENSARLING. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman 
from New Jersey (Mr. Garrett), the chairman of our Capital Markets and 
Government Sponsored Enterprises Subcommittee.
  Mr. GARRETT. I thank the chairman and I thank the gentleman from 
Michigan (Mr. Huizenga) for all of their hard work to bring greater 
transparency to one of the most secretive agencies in the government, 
the Federal Reserve.
  Mr. Chairman, earlier this year, Fed Chair Janet Yellen said: ``The 
Federal Reserve is already one of the most transparent central banks 
around the globe.''
  Really? If that were the case, why is it we have seen the following 
headlines in the last few years: March of last year, Forbes, ``Fed on 
Target to Raise Interest Rates in Spring of 2015''; then in October, 
``Two Fed Officials Say Interest Rates to Rise in Mid-2015''; then in 
The Wall Street Journal just last month, ``Fed Doubts Grow on 2015 Rate 
Hike''; and then just 2 weeks later in The Wall Street Journal, ``Fed 
Keeps December Rate Hike in Play.''
  So which is it? Mr. Chairman, a simple Google search on the subject 
pulls up a range of headlines on this topic all pointing to one fact: 
There is a great deal of confusion and uncertainty as to how the 
Federal Reserve actually conducts its own monetary policy.
  So the bottom line is the Fed needs to follow a rule when conducting 
monetary policy, and this bill, H.R. 3189, gives the Fed that 
flexibility to develop and implement its own rule as it sees fit and 
then simply to report to Congress and the public, should it find the 
need to deviate from it.

                              {time}  1800

  And this will then do what? It will give us greater economic 
certainty and moves us away from what we have seen, a Fed guessing game 
that we have all become too used to.
  More troubling than all this, more troubling than the monetary 
policy, however, is the lack of transparency and accountability and 
openness surrounding their regulatory function. Despite the Fed's 
failure to prevent the crisis in 2008, despite their failure to even 
see it coming, the Dodd-Frank Act bestowed upon the Fed tremendous new 
regulatory authority, authority that it is now using to try and 
regulate huge swaths of the financial system, and what they are really 
trying to do is to stamp out all risk taking, if you will, in our 
capital markets.
  The Fed fails to conduct any cost-benefit analysis of the rulemaking 
in that, and it has conspired, if you will, with various secretive 
international bodies, like the FSB, the Financial Stability Board, in 
so doing to try to rewrite the rules, if you will, to the detriment of 
who? Well, the American capital markets.
  So before us today is the FORM Act, which would do what? It would 
shine the light of day, if you will, on the Fed's regulatory 
operations, so that all of us, the American public, can see actually 
what the powers are up to. So now more than ever we need transparency 
and accountability in the Federal Reserve.
  I thank the chairman, and I thank the sponsor of the bill for moving 
the underlying bill.
  Ms. MAXINE WATERS of California. Mr. Chairman, I yield 2 minutes to 
the gentlewoman from Wisconsin (Ms. Moore), the ranking member of the 
Subcommittee on Monetary Policy and Trade on the Financial Services 
Committee.

[[Page 18456]]


  Ms. MOORE. Mr. Chairman, as the ranking member of the Monetary Policy 
and Trade Subcommittee, I rise in strong opposition to H.R. 3189.
  Sometimes you can disagree on a bill, and it doesn't really make much 
difference. But this bill is extremely dangerous for many reasons. I 
want to focus on just two provisions--my time is limited--that would be 
absolutely disastrous for the U.S. economy:
  One is the political audits of the Federal Reserve.
  And, second, the computer model monetary policy, so-called Taylor 
rule.
  Now, people think, well, what is wrong with auditing the Fed? The Fed 
is already audited, including an external audit, which all Americans 
can review online. This bill creates a mechanism for political audits 
of the Fed. Injecting politics into monetary policy and undermining the 
independence of the Central Bank would be an absolute disaster.
  I am thinking just recently of the transportation bill that we passed 
out of here--and I voted for it, hoping that it can be fixed in 
conference--where the Fed is required to provide $60 billion--that is 
billion with a B, Mr. Chairman--and then is not being allowed to 
replenish its money supply. This is more than just tinkering in our 
economy.
  There is overwhelming evidence and academic research that 
demonstrated an independent central bank anywhere in the world making 
economic decisions and not political decisions delivers lower 
inflation, higher employment, and better economic results.
  Currently, the U.S. enjoys low borrowing costs, and our debt is 
considered the gold standard. The U.S. dollar is literally the reserve 
currency of countries around the world.
  If adopted, this bill would potentially undermine the exalted status 
of U.S. debt.
  The Acting CHAIR (Mr. Hardy). The time of the gentlewoman has 
expired.
  Ms. MAXINE WATERS of California. I yield the gentlewoman from 
Wisconsin an additional 1 minute.
  Ms. MOORE. Does anyone in America think that Congress is going to be 
more confident at conducting monetary policy than an independent 
central bank?
  Let me remind you, under the stewardship of the Republican leadership 
of this House, we have seen government shutdowns, U.S. debt default 
threats, and fiscal austerity measures that hamper the economic 
recovery.
  As to this Taylor rule, I doubt that anybody over there can explain 
the Taylor rule to you. But I tell you, had we had the Taylor rule in 
place in the 1980s when Volcker was here, he would not have been able 
to stop the rampant inflation that we experienced. The assumptions that 
it is based on have not accounted for Volcker's inflation fighting or 
Bernanke's aggressive recovery status. They couldn't have done it under 
this Taylor rule.
  And, furthermore, banks, Wall Street, all the investors, would set 
their models to the Fed commuter model, and then it would set up all 
kinds of economic disruptions if the Fed would ever deviate from the 
model. It would take the discretion away from the Fed.
  I strongly oppose the bill, and I urge my colleagues to reject this 
dangerous legislation.
  Mr. HENSARLING. Mr. Chairman, I yield myself 10 seconds to, once 
again, encourage my colleagues to actually read the bill.
  The Taylor rule is not mandated for the Federal Reserve. But had the 
Federal Reserve followed the Taylor rule in the first place, we would 
not have had a financial crisis because the real estate bubble would 
not have been inflated by the Fed keeping money too loose, too long.
  I yield 2 minutes to the gentleman from Wisconsin (Mr. Duffy), the 
chairman of our Oversight and Investigations Subcommittee.
  Mr. DUFFY. Mr. Chairman, I appreciate the chairman yielding.
  I want to thank Chairman Huizenga for his good work on the FORM Act. 
I think this is a commonsense set of reforms that make the Federal 
Reserve more accountable to the American people, which means they are 
more accountable to the United States Congress.
  I would ask my colleagues across the aisle and my good friend from 
Wisconsin (Ms. Moore), who says that the FORM Act is one that would 
provide for the Congress to set monetary policy, where in the FORM Act 
does it say that? Just because we ask for oversight, just because we 
want to have the Federal Reserve accountable to the Congress and to the 
American people, doesn't mean that Congress is taking the role of 
setting monetary policy. Again, that is just setting up a straw man and 
trying to knock it down in the argument.
  This is important stuff. There is a distinct difference between the 
two sides of the aisle. We do think there should be accountability and 
transparency. But my friends across the aisle will continue to advocate 
for very powerful government institutions empowering bureaucrats that 
are not elected and that are not accountable to the American people to 
make decisions that have huge impacts on the American people.
  What we say on our side of the aisle is, in our form of government, 
the people have a right to have a say in their government, which means 
you need to empower the Congress and the Senate to have oversight over 
these very powerful organizations.
  That is the great debate that we are having here. We want oversight 
and transparency. We don't want to set monetary policy.
  I chair the Committee on Oversight, and we have asked the Federal 
Reserve for documents that we are entitled to in regard to an FOMC 
leak. The Federal Reserve has basically said:
  Yes, you are entitled to these documents. But, guess what, we are not 
going to give them to you.
  What is the reason, Madam Chair?
  I don't have a really good reason. Some people asked me not to give 
them to you. I know you are entitled, but I am not going to send them 
over to you.
  The Acting CHAIR. The time of the gentleman has expired.
  Mr. HENSARLING. I yield the gentleman from Wisconsin 30 seconds.
  Mr. DUFFY. We had to go to extreme measures to get the Federal 
Reserve to comply with our subpoenas to provide us the documents that 
this institution is entitled to. That shows how arrogant this 
institution--the Fed--really is.
  A rules-based approach makes sense. An audit of the Fed taking a look 
back that is not political, but a retrospective look at the Fed's 
monetary policy, makes absolute sense.
  And to think that we are going to talk about the blackout period at 
the Fed that, yes, you can have a blackout for monetary policy, but you 
can't use that blackout when we are talking about the supervisory and 
prudential functions of the Federal Reserve.
  Ms. MAXINE WATERS of California. Mr. Chairman, I yield myself such 
time as I may consume.
  I cringe at the thought that the documents from the FOMC meeting of 
2012 would be released to the Members of Congress. They would cause 
some volatility in the markets and shake up this country and cause such 
harm that everybody ought to be alarmed at the thought.
  I yield 3 minutes to the gentleman from Illinois (Mr. Foster), a 
member of the Committee on Financial Services.
  Mr. FOSTER. Mr. Chairman, I thank the ranking member for yielding.
  Mr. Chairman, I rise today in opposition to the legislation designed 
to chip away at the independence of the Federal Reserve. The Federal 
Reserve's objectives of maximum employment and stable prices have and 
will remain moving targets. The legislation attacks the independent 
judgment of the Fed in a number of ways by intrusive and dangerous 
meddling in the guise of Congressional oversight.
  This legislation also suggests that this complex task could somehow 
be reduced to a function of two variables. Now, I am a physicist and, 
as Albert Einstein said: ``Everything should be made as simple as 
possible but not simpler.'' In reality, economics is a field of study 
that is constrained by numbers, but within those constraints, there lie

[[Page 18457]]

large psychological variables and many external, often international, 
and often random variables.
  It is obvious that any two-variable rule is far too simple to guide 
the monetary policy of a $17 trillion national economy interconnected 
with the economies in every part of the world.
  It is also clear from the incoherent and counterfactual tirades that 
we listen to in our committee after the Republican financial collapse 
of 2007, that we want to keep politics as far away as possible from 
Federal Reserve monetary policy.
  The truth is that Federal monetary policy is already guided, but not 
determined, by a number of complex, macroeconomic models. It is very 
far from ad hoc. In fact, at the heart of many of these models lies a 
variance of what is called the Cobb-Douglas production function. And 
the Douglas in that name is Senator Paul Douglas, an economist from the 
University of Chicago before he became a Senator and the author of some 
of the most influential papers in economics. My mother worked for 
Senator Paul Douglas when he was a Senator back in the 1950s, and when 
I see the level to which economic debate has fallen in this country 
from Senator Paul Douglas to what we see today, it breaks my heart.
  Now, I agree that our markets and economies have changed since the 
Federal Reserve was formed. And the system deserves study, but this 
bill is not about studying the Federal Reserve. It is about subjecting 
it to the politics and the backseat driving that it often needs to 
overcome to meet its dual mandate.
  Mr. Chairman, this bill chips away at the independence of the Federal 
Reserve, and I urge my colleagues to join me in opposing it.
  Mr. HENSARLING. Mr. Chairman, I yield 3 minutes to the gentleman from 
Pennsylvania (Mr. Rothfus).
  Mr. ROTHFUS. Mr. Chairman, over the last 6 years, Americans have 
watched as the Federal Reserve has embarked on an interventionist 
monetary policy to an unprecedented degree.
  The Fed's quantitative easing marked a dramatic departure from 
traditional monetary policy in the United States, and it resulted in a 
massive expansion of the Fed's balance sheet to some $4.5 trillion. To 
put this number in perspective, that is almost five times the size of 
the Fed's balance sheet before the financial crisis when it stood at 
$800 billion. It also represents one-quarter of the total size of the 
U.S. economy.
  Unfortunately, despite this enormous expansion and influence over the 
economy, the Fed has persistently failed to implement measures to 
increase transparency as to its decisionmaking.
  Americans continue to face a sluggish economy that has fallen far 
short of its potential, and they want to know the reasoning behind the 
Fed's actions or lack thereof. This is particularly important for those 
who have saved money for their retirement, especially grandparents on 
fixed incomes, who are being directly harmed by the Fed's decision to 
keep rates at near zero. They want transparency and answers from their 
government.
  I suggest also our citizens should understand why the Federal Reserve 
would take an unprecedented action to explode its balance sheet by more 
than 400 percent over 5 years. No one--no one--knows how this 
experiment will end up turning out.
  The legislation that we are considering today would implement 
important reforms to address these issues. To start, by requiring the 
Fed to explain the differences between its monetary policy decisions 
and a rigorously studied reference rule, the legislation would go far 
to improve the American public's understanding of monetary policy and 
how it impacts their lives.
  Similarly, by requiring a cost-benefit analysis for any regulation 
that the Fed chooses to promulgate, it will ensure that all relevant 
costs are properly taken into account and that the Fed considers the 
full consequences of its actions in an open and understandable fashion.
  To be clear, these reforms are about increasing transparency and 
improving how the Fed communicates its policy decisions to the American 
public. Contrary to what some claim, the legislation does not--does 
not--mandate any particular policy decisions, nor does it impact or 
threaten the Fed's independence in setting monetary policy. In fact, 
few have made a better case for these sorts of reforms than Chair 
Yellen herself, who stated: ``Transparency concerning Federal Reserve's 
conduct of monetary policy is desirable because better public 
understanding enhances the effectiveness of policy.''
  Mr. Chairman, transparency and openness serve to strengthen a 
democratic republic like ours. That is what this legislation is all 
about.
  I urge my colleagues to support this bill.

                              {time}  1815

  Ms. MAXINE WATERS of California. Mr. Chairman, I inquire as to 
whether or not the chairman has more speakers.
  Mr. HENSARLING. Mr. Chairman, we have at least three to four more 
speakers.
  Ms. MAXINE WATERS of California. Mr. Chairman, I reserve the balance 
of my time.
  Mr. HENSARLING. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman 
from Indiana (Mr. Messer).
  Mr. MESSER. Mr. Chairman, I rise today in support of H.R. 3189, the 
Fed Oversight Reform and Modernization Act.
  We all recognize the importance of the Federal Reserve's independence 
when making monetary policy decisions. However, the American people 
rightly expect the Federal Reserve to be held accountable, too. They 
deserve to know exactly what the Federal Reserve does and to know that 
its rulemaking process is transparent and subjected to appropriate 
congressional oversight.
  As a Member who represents 19 rural and suburban Indiana counties, I 
know middle America is still struggling to get back on its feet after 
the 2008 financial crisis. Hardworking Hoosiers know they didn't cause 
the financial collapse, but they are frustrated because the folks who 
did cause the crisis--bad actors in private industry and ineffective 
Federal banking regulators--haven't been held accountable at all.
  The status quo is unacceptable. The Fed should be accountable and 
transparent in its decisionmaking, and H.R. 3189 is an important step 
towards that goal.
  I urge my colleagues to support the bill.
  Ms. MAXINE WATERS of California. Mr. Chairman, I reserve the balance 
of my time.
  Mr. HENSARLING. Mr. Chairman, I yield 3 minutes to the gentleman from 
Minnesota (Mr. Emmer).
  Mr. EMMER of Minnesota. Mr. Chairman, I rise today in support of the 
much-needed Fed Oversight Reform and Modernization Act.
  Minnesotans, like Robert from Becker and Kevin from Elk River, are 
correct in that the Fed is an ineffective and isolated government 
bureaucracy that is out of touch with the common man and the long-term 
needs of the American people.
  Yes, quantitative easing may have been a boon for a few. However, 
three rounds of this reckless tactic have inflated the Fed's balance 
sheet to more than $4.5 trillion, threatening the economic stability of 
our Nation and the American Dream for many.
  Equally problematic is the secrecy surrounding the Fed's discount 
window operations, open market operations, and agreements with foreign 
governments, which prevent market actors from knowing the information 
they need in order to prudently invest in the future.
  In the past, Congressman Ron Paul led the charge against the Fed with 
his Audit the Fed bill. Today we are building upon his legacy 
legislation. I would like to thank my colleague, Congressman Huizenga, 
for introducing the Fed Oversight Reform and Modernization Act.
  Not only does this new legislation include Audit the Fed, but it also 
requires the Fed establish a monetary policy rule that will enable us 
to have a better idea of where the Fed is likely to move monetary 
policy. Additionally,

[[Page 18458]]

the bill limits taxpayers' exposure to bailouts by responsibly 
tightening the Fed's emergency lending authority.
  Furthermore, this bill requires the Fed, before implementing any 
rule, to conduct a cost-benefit analysis. This will give the American 
people a true sense of the economic impact any Fed proposal will have. 
It would also mandate the Fed, Federal Deposit Insurance Corporation, 
and Treasury to disclose any positions they plan to take at 
international regulatory negotiations, enabling the American people and 
Congress to weigh in on international regulations that often adversely 
impact American business.
  Finally, this legislation would clarify the Federal Open Market 
Committee blackout period, mandate the Fed to disclose employees' 
salaries, require the Chair of the Fed to participate in congressional 
hearings quarterly, and give more power to local district Fed Bank 
presidents over open market operations.
  I understand that many of my colleagues on the other side of the 
aisle may be skeptical about reforming the Fed. However, it is 
important to remember that this legislation only enhances oversight, 
communication, and transparency. This legislation will in no way take 
away the Federal Reserve's control of monetary policy, but it will 
provide us the tools to ensure that sound policies are enacted.
  Mr. Chairman, again I thank Mr. Huizenga and Chairman Hensarling for 
their work on this bill. I encourage my colleagues to vote in favor of 
the Fed Oversight Reform and Modernization Act.
  Ms. MAXINE WATERS of California. Mr. Chairman, I reserve the balance 
of my time.
  Mr. HENSARLING. Mr. Chairman, may I inquire as to how much time is 
remaining on both sides?
  The Acting CHAIR. The gentleman from Texas has 4\1/2\ minutes 
remaining. The gentlewoman from California has 13 minutes remaining.
  Mr. HENSARLING. Mr. Chairman, I yield 2 minutes to the gentleman from 
Michigan (Mr. Huizenga), the author of the FORM Act.
  Mr. HUIZENGA of Michigan. Mr. Chairman, I am taking this second 
opportunity to rise because I think we have heard a lot of 
misinformation out there, and there is a lot of fog that has been 
getting thrown up into the air.
  This is about transparency. This is about accountability. This is not 
about Congress' coming in and dictating to the Fed how to do business. 
They, the Fed, will set a benchmark that they will then be measured 
against. It is not we. It is not Congress saying what they will or will 
not do. It is they, themselves. That seems pretty reasonable.
  It also seems very reasonable to me that, if we are ever finding 
ourselves in a position in which there are these massive bank bailouts 
that some would claim need to be done again, we would have a belt and 
suspenders way to approach it in that we would say not just two or 
three or four people are going to decide whether that is going to 
happen, but that we would actually get the regional Fed Bank Governors 
involved in that as well. We would say that 9 of the 12 of them have to 
agree with the decisions that are being made.
  We make sure that there is a redundancy, that we are not just rushing 
and plunging headlong. Ultimately, the goal is to make sure that we 
never have that situation happen again so that we never find ourselves 
in that situation of having to even have the discussion about whether 
we would have massive bank bailouts, which is what happened in 2009 
under this administration.
  Again, I appreciate the effort that has been put into this. There are 
a lot of small details to it, but there are a lot of broad themes to 
it. At the end of the day, we know that this is the best thing not only 
for Congress, not only for the Fed, but, ultimately, for the American 
people as they are demanding us to hold an organization accountable 
that we in Congress created not in an unreasonable fashion, but in a 
way that is balanced, transparent, and that ultimately helps the 
stability of the U.S. economy.
  Ms. MAXINE WATERS of California. Mr. Chairman, I yield myself the 
balance of my time.
  I am going to take the unusual step of reading a letter from Janet 
Yellen, the Chair of the Board of Governors of the Federal Reserve 
Bank. I take this unusual step because the letter is so well written 
and explains in such a profound way why the bill that is before us is 
dangerous and problematic.
  ``Dear Mr. Speaker and Madam Leader: I am writing regarding the House 
of Representatives' consideration of H.R. 3189, the Fed Oversight 
Reform and Modernization Act''--known as the FORM Act--``The FORM Act 
would severely impair the Federal Reserve's ability to carry out its 
congressional mandate to foster maximum employment and stable prices 
and would undermine our ability to implement policies that are in the 
best interest of American businesses and consumers. This legislation 
would severely damage the U.S. economy were it to become law.
  ``There are a number of harmful provisions in the FORM Act, but the 
provisions concerning the conduct of monetary policy are especially 
troubling. Section 2 of the bill would require the Federal Reserve to 
establish a mathematical formula or `directive policy rule' that would 
dictate how the Federal Open Market Committee adjusts the stance of 
monetary policy at every FOMC meeting. The Government Accountability 
Office (GAO) would be responsible for determining whether the rule 
adopted by the FOMC met all the criteria in the legislation. Any time 
the FOMC was judged not to be in compliance with the GAO-approved rule, 
the GAO would be required to conduct a full review of monetary policy 
and submit a report to the Congress. Moreover, the GAO would also be 
required to conduct a full review of monetary policy and report to the 
Congress any time the FOMC changed its policy rule.
  ``These provisions are significantly flawed for a number of reasons. 
Most importantly, the provisions effectively cast aside the bipartisan 
approach toward monetary policy oversight developed by the Congress in 
the late 1970s. Under that approach, the Congress establishes the long-
run objectives for monetary policy but affords the Federal Reserve a 
considerable degree of independence in how it goes about achieving 
those statutory goals, thus ensuring that the conduct of monetary 
policy is insulated from political influence. This framework is now 
recognized as a fundamental principle of central banking around the 
world. The provisions of the FORM Act, in contrast, would effectively 
put the Congress and the GAO squarely in the role of reviewing short-
run monetary policy decisions and in a position to, in real time, 
influence the monetary policy deliberations leading to those decisions.
  ``Conducting monetary policy by strictly adhering to the 
prescriptions of a simple rule would lead to poor economic outcomes. 
There is no consensus among economists or policymakers about a simple 
policy rule that is best suited to cover a wide range of scenarios. For 
example, even during the period known as the Great Moderation, in the 
1980s and 1990s, when a simple rule might have been expected to work 
well, the actual level of the Federal funds rate often diverged 
substantially from the level prescribed by the reference rule included 
in the FORM Act. Indeed, for much of this period, monetary policy was 
actually tighter than what would have been the case under that rule.
  ``Even more tellingly, no simple policy rule has yet been devised 
that would adequately address the effective lower bound on the policy 
rate--a constraint that has been binding in the United States since 
late 2008. Had the FOMC been compelled to operate under a simple policy 
rule for the past six and a half years, the unemployment experience of 
that period would have been substantially more painful than it already 
was, and inflation would be even further below the FOMC's 2 percent 
objective. Indeed, a recent study by the Federal Reserve economists 
suggests that the current unemployment rate would still be above 6 
percent and inflation would now be running somewhat below zero, if the 
FOMC had not

[[Page 18459]]

taken the actions it did but rather had followed the reference rule and 
made it clear that it would do so in the future. In other words, 
millions of Americans would have suffered unnecessary spells of 
joblessness over this period, generating enormous amounts of personal 
and collective damage that could have been avoided--and, in fact, was 
avoided because we had the latitude to use our available tools 
responsibly and forcefully.
  ``In addition to allowing the GAO to conduct a review specifically 
related to the `directive policy rule,' Section 13 of the FORM Act also 
allows GAO to more broadly review and analyze the monetary policy 
decisions of the Federal Reserve at any time. This provision would 
politicize monetary policy and bring short-term political pressures 
into the deliberations of the FOMC by putting into place real-time 
second guessing of policy decisions. Such action would undermine the 
independence of the Federal Reserve and likely lead to an increase in 
inflation fears and market interest rates, a diminished status of the 
dollar in global financial markets, and reduced economic and financial 
stability.
  ``The provision is based on a false premise--that the Federal Reserve 
is not subject to an audit. To the contrary, under existing law, the 
financial statements of the Federal Reserve System are audited annually 
by an independent accounting firm under the supervision of the 
Inspector General for the Board.

                              {time}  1830

  ``These audited financial statements are made publicly available and 
provided to Congress annually. The GAO may also conduct an audit of the 
Board's financial statements and of transactions that the Federal 
Reserve conducts in the course of its lending and other activities. In 
addition, each week, the Federal Reserve publishes its balance sheet 
and charts of recent balance sheet trends as well as every security the 
Federal Reserve holds along with each security's CUSIP number. 
Moreover, as specified in the Dodd-Frank Wall Street Reform and 
Consumer Protection Act, the Federal Reserve now releases detailed 
transaction level information for all open market operations and 
discount window with a 2-year lag.
  ``I am concerned about other provisions in the FORM Act as well, 
including the debilitating restrictions on the Federal Reserve's 
emergency lending authorities. In the face of a future crisis--where 
collapse of the financial system is on the scale of the Great 
Depression or the recent financial crisis--I believe it is essential 
that the Federal Reserve have the emergency lending powers necessary in 
those circumstances to support the flow of credit to households and 
businesses and mitigate harm to the U.S. economy. The FORM Act would 
essentially repeal the Federal Reserve's remaining ability to act in a 
crisis. I am also deeply troubled by provisions related to the Federal 
Reserve's supervisory responsibilities, particularly those that would 
undermine the strength and effectiveness our stress tests and impede 
our ability to advocate internationally for standards that are in the 
best interest of U.S. businesses and consumers.
  ``Throughout my career and certainly during my many years working 
with the Federal Reserve System, I have been an advocate for greater 
openness and transparency. As Chair, I remain committed to these 
important issues. Accountability and transparency of public 
institutions are critical in a democratic society. Unfortunately, the 
FORM Act attempts to increase transparency and accountability through 
misguided provisions that would expose the Federal Reserve to short-
term political pressures. For these reasons, I urge the House not to 
adopt the FORM Act. The bill would severely impair the Federal 
Reserve's ability to carry out its congressional mandate and would be a 
grave mistake, detrimental to the economy and the American people.''
  I don't think it could be better stated. I think the letter that I 
just read from Janet Yellen tells it all. It simply warns us about the 
danger of this bill. It not only warns us. It does it in such a way 
that everybody can understand it and would not want to put this economy 
and this country at such a risky position. I am hopeful that the 
Members will hear this. We will make copies available to everyone. Vote 
against this bill.
  Furthermore, there is a Statement of Administration Policy from the 
Executive Office of the President, Office of Management and Budget:
  ``H.R. 3189 would establish requirements for policy rules, codify 
blackout periods of the Federal Open Market Committee, establish a 
cost-benefit requirement for other rulemakings by the Federal Reserve 
Board, and establish numerous, burdensome reporting requirements for 
the Federal Reserve Board and its members. The Administration therefore 
strongly opposes H.R. 3189.
  ``The Federal Reserve is an independent entity designed to be free 
from political pressures, and its independence is key to its 
credibility and its ability to act in the long-term interest of the 
Nation's economic health. One of the most problematic provisions in the 
bill would require the Comptroller General to audit the conduct of 
monetary policy by the Federal Reserve Board and the Federal Open 
Market Committee. The operations of the Federal Reserve are already 
subject to numerous audit requirements that ensure it is accountable to 
the Congress and the American people. The only aspect of the Federal 
Reserve's operations not subject to audit is its monetary policy 
decisionmaking, and for good reason. Subjecting the Federal Reserve's 
exercise of monetary policy authority to audits based on political 
whims of Members of the Congress--of either party--threatens one of the 
central pillars of the Nation's financial system and economy, and would 
almost certainly have negative impacts on the Federal Reserve's work to 
promote price stability and full employment.
  ``H.R. 3189 also would impose numerous, burdensome requirements for 
the Federal Reserve Board rulemaking authorities, including the 
imposition of a duplicative requirement that the Federal Reserve Board 
undertake a proscriptive cost-benefit analysis and a post-adoption 
impact assessment when promulgating rules. When a Federal agency, 
including an independent agency such as the Federal Reserve, 
promulgates a regulation, the agency must adhere to the robust 
substantive and procedural requirements of Federal law, including the 
Administrative Procedure Act, the Regulatory Flexibility Act, the 
Paperwork Reduction Act, and the Congressional Review Act, among other 
statutes. Additionally, Executive Order 13579 encourages independent 
regulatory agencies to conduct reasoned cost-benefit analysis, engage 
in public participation to the extent feasible, and conduct a 
systematic retrospective review of regulations.''
  I can't read it all, but if the President was presented with H.R. 
3189, his senior advisers would recommend that he veto this bill.
  I yield back the balance of my time.
  Mr. HENSARLING. Mr. Chairman, the ranking member for the last 13 
minutes has let us know that the President and his bureaucratic 
appointees don't want any more transparency and accountability. I don't 
particularly find a news flash in that.
  I have the greatest amount of respect for Chair Yellen. I both like 
and respect her. I have never encountered a bureaucrat who didn't want 
more money, more power, less transparency, and less accountability. She 
is no different. The Dodd-Frank Act has vastly expanded the powers of 
the Federal Reserve.
  Mr. Chairman, for all intents and purposes, they have the ability to 
actually come in and de facto manage any large financial institution in 
America. The government has that power. It is a frightening power that 
has been given by Dodd-Frank, and transparency and accountability is 
demanded.
  In addition, we have a Federal Reserve taking monetary policy and 
tools to a place it has never been before. At a bare minimum, it owes 
the people's elected Representatives, the Congress, some transparency 
on why it is doing what it is doing.

[[Page 18460]]

  I would, yet again, encourage all Members to actually read the bill 
before they claim to know what is in the bill. The Federal Reserve 
maintains its monetary policy independence, as it should. But it must 
explain to the rest of us what that is and why they choose to deviate 
from it if they believe economic circumstances warrant. Again, if they 
want to base monetary policy on the Taylor rule, so be it. If they want 
to base it on a rousing game of rock, paper, and scissors, so be it. 
The American people demand answers because this economy is still 
underperforming. It is not working for working people. This has to 
change.
  We have had the largest economic monetary policy stimulus in our 
Nation's history, but yet it does not work for working people, and the 
poor continue to follow behind.
  All this bill by the gentleman of Michigan does is bring about needed 
transparency and accountability to the most powerful economic agency in 
government today. It is demanded by the vast increases in power by the 
Dodd-Frank Act. The American people deserve answers. We should enact 
it.
  I encourage all Members to vote for H.R. 3189, the FORM Act.
  I yield back the balance of my time.
  The Acting CHAIR. All time for general debate has expired.
  In lieu of the amendment in the nature of a substitute recommended by 
the Committee on Financial Services, printed in the bill, an amendment 
in the nature of a substitute consisting of the text of Rules Committee 
Print 114-35, modified by the amendment printed in the part B of House 
Report 114-341, is adopted. The bill, as amended, shall be considered 
as the original bill for the purpose of further amendment under the 5-
minute rule and shall be considered as read.
  The text of the bill, as amended, is as follows:

                               H.R. 3189

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Fed 
     Oversight Reform and Modernization Act of 2015'' or the 
     ``FORM Act of 2015''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

       Sec. 1. Short title; table of contents.
       Sec. 2. Requirements for policy rules of the Federal Open 
           Market Committee.
       Sec. 3. Federal Open Market Committee blackout period.
       Sec. 4. Membership of Federal Open Market Committee.
       Sec. 5. Requirements for stress tests and supervisory 
           letters for the Board of Governors of the Federal 
           Reserve System.
       Sec. 6. Frequency of testimony of the Chairman of the Board 
           of Governors of the Federal Reserve System to Congress.
       Sec. 7. Vice Chairman for Supervision report requirement.
       Sec. 8. Economic analysis of regulations of the Board of 
           Governors of the Federal Reserve System.
       Sec. 9. Salaries, financial disclosures, and office staff 
           of the Board of Governors of the Federal Reserve 
           System.
       Sec. 10. Requirements for international processes.
       Sec. 11. Amendments to powers of the Board of Governors of 
           the Federal Reserve System.
       Sec. 12. Interest rates on balances maintained at a Federal 
           Reserve bank by depository institutions established by 
           Federal Open Market Committee.
       Sec. 13. Audit reform and transparency for the Board of 
           Governors of the Federal Reserve System.
       Sec. 14. Reporting requirement for Export-Import Bank.
       Sec. 15. Membership of Board of Directors of the Federal 
           reserve banks.
       Sec. 16. Establishment of a Centennial Monetary Commission.

     SEC. 2. REQUIREMENTS FOR POLICY RULES OF THE FEDERAL OPEN 
                   MARKET COMMITTEE.

       The Federal Reserve Act (12 U.S.C. 221 et seq.) is amended 
     by inserting after section 2B the following new section:

     ``SEC. 2C. DIRECTIVE POLICY RULES OF THE FEDERAL OPEN MARKET 
                   COMMITTEE.

       ``(a) Definitions.--In this section the following 
     definitions shall apply:
       ``(1) Appropriate congressional committees.--The term 
     `appropriate congressional committees' means the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate.
       ``(2) Directive policy rule.--The term `Directive Policy 
     Rule' means a policy rule developed by the Federal Open 
     Market Committee that meets the requirements of subsection 
     (c) and that provides the basis for the Open Market 
     Operations Directive.
       ``(3) GDP.--The term `GDP' means the gross domestic product 
     of the United States as computed and published by the 
     Department of Commerce.
       ``(4) Intermediate policy input.--The term `Intermediate 
     Policy Input'--
       ``(A) may include any variable determined by the Federal 
     Open Market Committee as a necessary input to guide open-
     market operations;
       ``(B) shall include an estimate of, and the method of 
     calculation for, the current rate of inflation or current 
     inflation expectations; and
       ``(C) shall include, specifying whether the variable or 
     estimate is historical, current, or a forecast and the method 
     of calculation, at least one of--
       ``(i) an estimate of real GDP, nominal GDP, or potential 
     GDP;
       ``(ii) an estimate of the monetary aggregate compiled by 
     the Board of Governors of the Federal Reserve System and 
     Federal reserve banks; or
       ``(iii) an interactive variable or a net estimate composed 
     of the estimates described in clauses (i) and (ii).
       ``(5) Legislative day.--The term `legislative day' means a 
     day on which either House of Congress is in session.
       ``(6) Open market operations directive.--The term `Open 
     Market Operations Directive' means an order to achieve a 
     specified Policy Instrument Target provided to the Federal 
     Reserve Bank of New York by the Federal Open Market Committee 
     pursuant to powers authorized under section 14 of this Act 
     that guide open-market operations.
       ``(7) Policy instrument.--The term `Policy Instrument' 
     means--
       ``(A) the nominal Federal funds rate;
       ``(B) the nominal rate of interest paid on nonborrowed 
     reserves; or
       ``(C) the discount window primary credit interest rate most 
     recently published on the Federal Reserve Statistical Release 
     on selected interest rates (daily or weekly), commonly 
     referred to as the H.15 release.
       ``(8) Policy instrument target.--The term `Policy 
     Instrument Target' means the target for the Policy Instrument 
     specified in the Open Market Operations Directive.
       ``(9) Reference policy rule.--The term `Reference Policy 
     Rule' means a calculation of the nominal Federal funds rate 
     as equal to the sum of the following:
       ``(A) The rate of inflation over the previous four 
     quarters.
       ``(B) One-half of the percentage deviation of the real GDP 
     from an estimate of potential GDP.
       ``(C) One-half of the difference between the rate of 
     inflation over the previous four quarters and two percent.
       ``(D) Two percent.
       ``(b) Submitting a Directive Policy Rule.--Not later than 
     48 hours after the end of a meeting of the Federal Open 
     Market Committee, the Chairman of the Federal Open Market 
     Committee shall submit to the appropriate congressional 
     committees and the Comptroller General of the United States a 
     Directive Policy Rule and a statement that identifies the 
     members of the Federal Open Market Committee who voted in 
     favor of the Rule.
       ``(c) Requirements for a Directive Policy Rule.--A 
     Directive Policy Rule shall--
       ``(1) identify the Policy Instrument the Directive Policy 
     Rule is designed to target;
       ``(2) describe the strategy or rule of the Federal Open 
     Market Committee for the systematic quantitative adjustment 
     of the Policy Instrument Target to respond to a change in the 
     Intermediate Policy Inputs;
       ``(3) include a function that comprehensively models the 
     interactive relationship between the Intermediate Policy 
     Inputs;
       ``(4) include the coefficients of the Directive Policy Rule 
     that generate the current Policy Instrument Target and a 
     range of predicted future values for the Policy Instrument 
     Target if changes occur in any Intermediate Policy Input;
       ``(5) describe the procedure for adjusting the supply of 
     bank reserves to achieve the Policy Instrument Target;
       ``(6) include a statement as to whether the Directive 
     Policy Rule substantially conforms to the Reference Policy 
     Rule and, if applicable--
       ``(A) an explanation of the extent to which it departs from 
     the Reference Policy Rule;
       ``(B) a detailed justification for that departure; and
       ``(C) a description of the circumstances under which the 
     Directive Policy Rule may be amended in the future;
       ``(7) include a certification that such Rule is expected to 
     support the economy in achieving stable prices and maximum 
     natural employment over the long term; and
       ``(8) include a calculation that describes with 
     mathematical precision the expected annual inflation rate 
     over a 5-year period.
       ``(d) GAO Report.--The Comptroller General of the United 
     States shall compare the Directive Policy Rule submitted 
     under subsection (b) with the rule that was most recently 
     submitted to determine whether the Directive Policy Rule has 
     materially changed. If the Directive Policy Rule has 
     materially changed, the Comptroller General shall, not later 
     than 7 days after each meeting of the Federal Open Market 
     Committee, prepare and submit a compliance report to the 
     appropriate congressional committees specifying

[[Page 18461]]

     whether the Directive Policy Rule submitted after that 
     meeting and the Federal Open Market Committee are in 
     compliance with this section.
       ``(e) Changing Market Conditions.--
       ``(1) Rule of construction.--Nothing in this Act shall be 
     construed to require that the plans with respect to the 
     systematic quantitative adjustment of the Policy Instrument 
     Target described under subsection (c)(2) be implemented if 
     the Federal Open Market Committee determines that such plans 
     cannot or should not be achieved due to changing market 
     conditions.
       ``(2) GAO approval of update.--Upon determining that plans 
     described in paragraph (1) cannot or should not be achieved, 
     the Federal Open Market Committee shall submit an explanation 
     for that determination and an updated version of the 
     Directive Policy Rule to the Comptroller General of the 
     United States and the appropriate congressional committees 
     not later than 48 hours after making the determination. The 
     Comptroller General shall, not later than 48 hours after 
     receiving such updated version, prepare and submit to the 
     appropriate congressional committees a compliance report 
     determining whether such updated version and the Federal Open 
     Market Committee are in compliance with this section.
       ``(f) Directive Policy Rule and Federal Open Market 
     Committee Not in Compliance.--
       ``(1) In general.--If the Comptroller General of the United 
     States determines that the Directive Policy Rule and the 
     Federal Open Market Committee are not in compliance with this 
     section in the report submitted pursuant to subsection (d), 
     or that the updated version of the Directive Policy Rule and 
     the Federal Open Market Committee are not in compliance with 
     this section in the report submitted pursuant to subsection 
     (e)(2), the Chairman of the Board of Governors of the Federal 
     Reserve System shall, if requested by the chairman of either 
     of the appropriate congressional committees, not later than 7 
     legislative days after such request, testify before such 
     committee as to why the Directive Policy Rule, the updated 
     version, or the Federal Open Market Committee is not in 
     compliance.
       ``(2) GAO audit.--Notwithstanding subsection (b) of section 
     714 of title 31, United States Code, upon submitting a report 
     of noncompliance pursuant to subsection (d) or subsection 
     (e)(2) and after the period of 7 legislative days described 
     in paragraph (1), the Comptroller General shall audit the 
     conduct of monetary policy by the Board of Governors of the 
     Federal Reserve System and the Federal Open Market Committee 
     upon request of the appropriate congressional committee. Such 
     committee may specify the parameters of such audit.
       ``(g) Congressional Hearings.--The Chairman of the Board of 
     Governors of the Federal Reserve System shall, if requested 
     by the chairman of either of the appropriate congressional 
     committees and not later than 7 legislative days after such 
     request, appear before such committee to explain any change 
     to the Directive Policy Rule.''.

     SEC. 3. FEDERAL OPEN MARKET COMMITTEE BLACKOUT PERIOD.

       Section 12A of the Federal Reserve Act (12 U.S.C. 263) is 
     amended by adding at the end the following new subsection:
       ``(d) Blackout Period.--
       ``(1) In general.--During a blackout period, the only 
     public communications that may be made by members and staff 
     of the Committee with respect to macroeconomic or financial 
     developments or about current or prospective monetary policy 
     issues are the following:
       ``(A) The dissemination of published data, surveys, and 
     reports that have been cleared for publication by the Board 
     of Governors of the Federal Reserve System.
       ``(B) Answers to technical questions specific to a data 
     release.
       ``(C) Communications with respect to the prudential or 
     supervisory functions of the Board of Governors.
       ``(2) Blackout period defined.--For purposes of this 
     subsection, and with respect to a meeting of the Committee 
     described under subsection (a), the term `blackout period' 
     means the time period that--
       ``(A) begins immediately after midnight on the day that is 
     one week prior to the date on which such meeting takes place; 
     and
       ``(B) ends at midnight on the day after the date on which 
     such meeting takes place.
       ``(3) Exemption for chairman of the board of governors.--
     Nothing in this section shall prohibit the Chairman of the 
     Board of Governors of the Federal Reserve System from 
     participating in or issuing public communications.''.

     SEC. 4. MEMBERSHIP OF FEDERAL OPEN MARKET COMMITTEE.

       Section 12A(a) of the Federal Reserve Act (12 U.S.C. 
     263(a)) is amended--
       (1) in the first sentence, by striking ``five'' and 
     inserting ``six'';
       (2) in the second sentence, by striking ``One by the board 
     of directors'' and all that follows through the period at the 
     end and inserting the following: ``One by the boards of 
     directors of the Federal Reserve Banks of New York and 
     Boston; one by the boards of directors of the Federal Reserve 
     Banks of Philadelphia and Cleveland; one by the boards of 
     directors of the Federal Reserve Banks of Richmond and 
     Atlanta; one by the boards of directors of the Federal 
     Reserve Banks of Chicago and St. Louis; one by the boards of 
     directors of the Federal Reserve Banks of Minneapolis and 
     Kansas City; and one by the boards of directors of the 
     Federal Reserve Banks of Dallas and San Francisco.''; and
       (3) by inserting after the second sentence the following: 
     ``In odd numbered calendar years, one representative shall be 
     elected from each of the Federal Reserve Banks of Boston, 
     Philadelphia, Richmond, Chicago, Minneapolis, and Dallas. In 
     even-numbered calendar years, one representative shall be 
     elected from each of the Federal Reserve Banks of New York, 
     Cleveland, Atlanta, St. Louis, Kansas City, and San 
     Francisco.''.

     SEC. 5. REQUIREMENTS FOR STRESS TESTS AND SUPERVISORY LETTERS 
                   FOR THE BOARD OF GOVERNORS OF THE FEDERAL 
                   RESERVE SYSTEM.

       (a) Stress Test Rulemaking, GAO Review, and Publication of 
     Results.--Section 165(i)(1)(B) of the Dodd-Frank Wall Street 
     Reform and Consumer Protection Act (12 U.S.C. 5365(i)(1)(B)) 
     is amended--
       (1) by amending clause (i) to read as follows:
       ``(i) shall--

       ``(I) issue regulations, after providing for public notice 
     and comment, that provide for at least 3 different sets of 
     conditions under which the evaluation required by this 
     subsection shall be conducted, including baseline, adverse, 
     and severely adverse, and methodologies, including models 
     used to estimate losses on certain assets; and
       ``(II) provide copies of such regulations to the 
     Comptroller General of the United States and the Panel of 
     Economic Advisors of the Congressional Budget Office before 
     publishing such regulations;''; and

       (2) in clause (v), by inserting before the period the 
     following: ``, including any results of a resubmitted test''.
       (b) Application of CCAR.--Section 165(i)(1) of such Act is 
     further amended by adding at the end the following new 
     subparagraph:
       ``(C) Application to ccar.--The requirements of 
     subparagraph (B) shall apply to all stress tests performed 
     under the Comprehensive Capital Analysis and Review exercise 
     established by the Board of Governors.''.
       (c) Publication of the Number of Supervisory Letters Sent 
     to the Largest Bank Holding Companies.--Section 165 of such 
     Act is further amended by adding at the end the following new 
     subsection:
       ``(l) Publication of Supervisory Letter Information.--The 
     Board of Governors shall publicly disclose--
       ``(1) the aggregate number of supervisory letters sent to 
     bank holding companies described in subsection (a) since the 
     date of the enactment of this section, and keep such number 
     updated; and
       ``(2) the aggregate number of such letters that are 
     designated as `Matters Requiring Attention' and the aggregate 
     number of such letters that are designated as `Matters 
     Requiring Immediate Attention'.''.

     SEC. 6. FREQUENCY OF TESTIMONY OF THE CHAIRMAN OF THE BOARD 
                   OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM TO 
                   CONGRESS.

       (a) In General.--Section 2B of the Federal Reserve Act (12 
     U.S.C. 225b) is amended--
       (1) by striking ``semi-annual'' each place it appears and 
     inserting ``quarterly''; and
       (2) in subsection (a)(2)--
       (A) by inserting ``and October 20'' after ``July 20'' each 
     place it appears; and
       (B) by inserting ``and May 20'' after ``February 20'' each 
     place it appears.
       (b) Conforming Amendment.--Paragraph (12) of section 10 of 
     the Federal Reserve Act (12 U.S.C. 247b(12)) is amended by 
     striking ``semi-annual'' and inserting ``quarterly''.

     SEC. 7. VICE CHAIRMAN FOR SUPERVISION REPORT REQUIREMENT.

       Paragraph (12) of section 10 of the Federal Reserve Act (12 
     U.S.C. 247(b)) is amended--
       (1) by redesignating such paragraph as paragraph (11); and
       (2) in such paragraph, by adding at the end the following: 
     ``In each such appearance, the Vice Chairman for Supervision 
     shall provide written testimony that includes the status of 
     all pending and anticipated rulemakings that are being made 
     by the Board of Governors of the Federal Reserve System. If, 
     at the time of any appearance described in this paragraph, 
     the position of Vice Chairman for Supervision is vacant, the 
     Vice Chairman for the Board of Governors of the Federal 
     Reserve System (who has the responsibility to serve in the 
     absence of the Chairman) shall appear instead and provide the 
     required written testimony. If, at the time of any appearance 
     described in this paragraph, both Vice Chairman positions are 
     vacant, the Chairman of the Board of Governors of the Federal 
     Reserve System shall appear instead and provide the required 
     written testimony.''.

     SEC. 8. ECONOMIC ANALYSIS OF REGULATIONS OF THE BOARD OF 
                   GOVERNORS OF THE FEDERAL RESERVE SYSTEM.

       (a) Amendment to Federal Reserve Act.--Section 11 of the 
     Federal Reserve Act (12 U.S.C. 248) is amended by inserting 
     after subsection (l) the following new subsection:
       ``(m) Consideration of Economic Impacts.--
       ``(1) In general.--Before issuing any regulation, the Board 
     of Governors of the Federal Reserve System shall--
       ``(A) clearly identify the nature and source of the problem 
     that the proposed regulation is designed to address and 
     assess the significance of that problem;
       ``(B) assess whether any new regulation is warranted or, 
     with respect to a proposed regulation that the Board of 
     Governors is required to issue by statute and with respect to 
     which the Board has the authority to exempt certain persons 
     from the application of such regulation, compare--

[[Page 18462]]

       ``(i) the costs and benefits of the proposed regulation; 
     and
       ``(ii) the costs and benefits of a regulation under which 
     the Board exempts all persons from the application of the 
     proposed regulation, to the extent the Board is able;
       ``(C) assess the qualitative and quantitative costs and 
     benefits of the proposed regulation and propose or adopt a 
     regulation only on a reasoned determination that the benefits 
     of the proposed regulation outweigh the costs of the 
     regulation;
       ``(D) identify and assess available alternatives to the 
     proposed regulation that were considered, including any 
     alternative offered by a member of the Board of Governors of 
     the Federal Reserve System or the Federal Open Market 
     Committee and including any modification of an existing 
     regulation, together with an explanation of why the 
     regulation meets the regulatory objectives more effectively 
     than the alternatives; and
       ``(E) ensure that any proposed regulation is accessible, 
     consistent, written in plain language, and easy to understand 
     and shall measure, and seek to improve, the actual results of 
     regulatory requirements.
       ``(2) Considerations and actions.--
       ``(A) Required actions.--In deciding whether and how to 
     regulate, the Board shall assess the costs and benefits of 
     available regulatory alternatives, including the alternative 
     of not regulating, and choose the approach that maximizes net 
     benefits. Specifically, the Board shall--
       ``(i) evaluate whether, consistent with achieving 
     regulatory objectives, the regulation is tailored to impose 
     the least impact on the availability of credit and economic 
     growth and to impose the least burden on society, including 
     market participants, individuals, businesses of different 
     sizes, and other entities (including State and local 
     governmental entities), taking into account, to the extent 
     practicable, the cumulative costs of regulations;
       ``(ii) evaluate whether the regulation is inconsistent, 
     incompatible, or duplicative of other Federal regulations; 
     and
       ``(iii) with respect to a proposed regulation that the 
     Board is required to issue by statute and with respect to 
     which the Board has the authority to exempt certain persons 
     from the application of such regulation, compare--

       ``(I) the costs and benefits of the proposed regulation; 
     and
       ``(II) the costs and benefits of a regulation under which 
     the Board exempts all persons from the application of the 
     proposed regulation, to the extent the Board is able.

       ``(B) Additional considerations.--In addition, in making a 
     reasoned determination of the costs and benefits of a 
     proposed regulation, the Board shall, to the extent that each 
     is relevant to the particular proposed regulation, take into 
     consideration the impact of the regulation, including 
     secondary costs such as an increase in the cost or a 
     reduction in the availability of credit or investment 
     services or products, on--
       ``(i) the safety and soundness of the United States banking 
     system;
       ``(ii) market liquidity in securities markets;
       ``(iii) small businesses;
       ``(iv) community banks;
       ``(v) economic growth;
       ``(vi) cost and access to capital;
       ``(vii) market stability;
       ``(viii) global competitiveness;
       ``(ix) job creation;
       ``(x) the effectiveness of the monetary policy transmission 
     mechanism; and
       ``(xi) employment levels.
       ``(3) Explanation and comments.--The Board shall explain in 
     its final rule the nature of comments that it received and 
     shall provide a response to those comments in its final rule, 
     including an explanation of any changes that were made in 
     response to those comments and the reasons that the Board did 
     not incorporate concerns related to the potential costs or 
     benefits in the final rule.
       ``(4) Postadoption impact assessment.--
       ``(A) In general.--Whenever the Board adopts or amends a 
     regulation designated as a `major rule' within the meaning of 
     section 804(2) of title 5, United States Code, it shall 
     state, in its adopting release, the following:
       ``(i) The purposes and intended consequences of the 
     regulation.
       ``(ii) The assessment plan that will be used, consistent 
     with the requirements of subparagraph (B), to assess whether 
     the regulation has achieved the stated purposes.
       ``(iii) Appropriate postimplementation quantitative and 
     qualitative metrics to measure the economic impact of the 
     regulation and the extent to which the regulation has 
     accomplished the stated purpose of the regulation.
       ``(iv) Any reasonably foreseeable indirect effects that may 
     result from the regulation.
       ``(B) Requirements of assessment plan and report.--
       ``(i) Requirements of plan.--The assessment plan required 
     under this paragraph shall consider the costs, benefits, and 
     intended and unintended consequences of the regulation. The 
     plan shall specify the data to be collected, the methods for 
     collection and analysis of the data, and a date for 
     completion of the assessment. The assessment plan shall 
     include an analysis of any jobs added or lost as a result of 
     the regulation, differentiating between public and private 
     sector jobs.
       ``(ii) Submission and publication of report.--The Board 
     shall, not later than 2 years after the publication of the 
     adopting release, publish the assessment plan in the Federal 
     Register for notice and comment. If the Board determines, at 
     least 90 days before the deadline for publication of the 
     assessment plan, that an extension is necessary, the Board 
     shall publish a notice of such extension and the specific 
     reasons why the extension is necessary in the Federal 
     Register. Any material modification of the assessment plan, 
     as necessary to assess unforeseen aspects or consequences of 
     the regulation, shall be promptly published in the Federal 
     Register for notice and comment.
       ``(iii) Data collection not subject to notice and comment 
     requirements.--If the Board has published the assessment plan 
     for notice and comment at least 30 days before the adoption 
     of a regulation designated as a major rule, the collection of 
     data under the assessment plan shall not be subject to the 
     notice and comment requirements in section 3506(c) of title 
     44, United States Code (commonly referred to as the Paperwork 
     Reduction Act). Any material modification of the plan that 
     requires collection of data not previously published for 
     notice and comment shall also be exempt from such 
     requirements if the Board has published notice in the Federal 
     Register for comment on the additional data to be collected, 
     at least 30 days before the initiation of data collection.
       ``(iv) Final action.--Not later than 180 days after 
     publication of the assessment plan in the Federal Register, 
     the Board shall issue for notice and comment a proposal to 
     amend or rescind the regulation, or shall publish a notice 
     that the Board has determined that no action will be taken on 
     the regulation. Such a notice will be deemed a final agency 
     action.
       ``(5) Covered regulations and other actions.--Solely as 
     used in this subsection, the term `regulation'--
       ``(A) means a statement of general applicability and future 
     effect that is designed to implement, interpret, or prescribe 
     law or policy, or to describe the procedure or practice 
     requirements of the Board of Governors, including rules, 
     orders of general applicability, interpretive releases, and 
     other statements of general applicability that the Board of 
     Governors intends to have the force and effect of law; and
       ``(B) does not include--
       ``(i) a regulation issued in accordance with the formal 
     rulemaking provisions of section 556 or 557 of title 5, 
     United States Code;
       ``(ii) a regulation that is limited to the organization, 
     management, or personnel matters of the Board of Governors;
       ``(iii) a regulation promulgated pursuant to statutory 
     authority that expressly prohibits compliance with this 
     provision; or
       ``(iv) a regulation that is certified by the Board of 
     Governors to be an emergency action, if such certification is 
     published in the Federal Register.''.
       (b) Rule of Construction.--Nothing in this section shall 
     apply to the requirements regarding the conduct of monetary 
     policy described in section 2.

     SEC. 9. SALARIES, FINANCIAL DISCLOSURES, AND OFFICE STAFF OF 
                   THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE 
                   SYSTEM.

       (a) In General.--Section 11 of the Federal Reserve Act (12 
     U.S.C. 248) is amended--
       (1) by redesignating the second subsection (s) (relating to 
     ``Assessments, Fees, and Other Charges for Certain 
     Companies'') as subsection (t); and
       (2) by adding at the end the following new subsections:
       ``(u) Ethics Standards for Members and Employees.--
       ``(1) Prohibited and restricted financial interests and 
     transactions.--The members and employees of the Board of 
     Governors of the Federal Reserve System shall be subject to 
     the provisions under section 4401.102 of title 5, Code of 
     Federal Regulations, to the same extent as such provisions 
     apply to an employee of the Securities and Exchange 
     Commission.
       ``(2) Treatment of brokerage accounts and availability of 
     account statements.--The members and employees of the Board 
     of Governors of the Federal Reserve System shall--
       ``(A) disclose all brokerage accounts that they maintain, 
     as well as those in which they control trading or have a 
     financial interest (including managed accounts, trust 
     accounts, investment club accounts, and the accounts of 
     spouses or minor children who live with the member or 
     employee); and
       ``(B) with respect to any securities account that the 
     member or employee is required to disclose to the Board of 
     Governors, authorize their brokers and dealers to send 
     duplicate account statements directly to Board of Governors.
       ``(3) Prohibitions related to outside employment and 
     activities.--The members and employees of the Board of 
     Governors of the Federal Reserve System shall be subject to 
     the prohibitions related to outside employment and activities 
     described under section 4401.103(c) of title 5, Code of 
     Federal Regulations, to the same extent as such prohibitions 
     apply to an employee of the Securities and Exchange 
     Commission.
       ``(4) Additional ethics standards.--The members and 
     employees of the Board of Governors of the Federal Reserve 
     System shall be subject to--
       ``(A) the employee responsibilities and conduct regulations 
     of the Office of Personnel Management under part 735 of title 
     5, Code of Federal Regulations;
       ``(B) the canons of ethics contained in subpart C of part 
     200 of title 17, Code of Federal Regulations, to the same 
     extent as such subpart applies to the employees of the 
     Securities and Exchange Commission; and
       ``(C) the regulations concerning the conduct of members and 
     employees and former members

[[Page 18463]]

     and employees contained in subpart M of part 200 of title 17, 
     Code of Federal Regulations, to the same extent as such 
     subpart applies to the employees of the Securities and 
     Exchange Commission.
       ``(v) Disclosure of Staff Salaries and Financial 
     Information.--The Board of Governors of the Federal Reserve 
     System shall make publicly available, on the website of the 
     Board of Governors, a searchable database that contains the 
     names of all members, officers, and employees of the Board of 
     Governors who receive an annual salary in excess of the 
     annual rate of basic pay for GS-15 of the General Schedule, 
     and--
       ``(1) the yearly salary information for such individuals, 
     along with any nonsalary compensation received by such 
     individuals; and
       ``(2) any financial disclosures required to be made by such 
     individuals.''.
       (b) Office Staff for Each Member of the Board of 
     Governors.--Subsection (l) of section 11 of the Federal 
     Reserve Act (12 U.S.C. 248) is amended by adding at the end 
     the following: ``Each member of the Board of Governors of the 
     Federal Reserve System may employ, at a minimum, 2 
     individuals, with such individuals selected by such member 
     and the salaries of such individuals set by such member. A 
     member may employ additional individuals as determined 
     necessary by the Board of Governors.''.

     SEC. 10. REQUIREMENTS FOR INTERNATIONAL PROCESSES.

       (a) Board of Governors Requirements.--Section 11 of the 
     Federal Reserve Act (12 U.S.C. 248), as amended by section 9 
     of this Act, is further amended by adding at the end the 
     following new subsection:
       ``(w) International Processes.--
       ``(1) Notice of process; consultation.--At least 30 
     calendar days before any member or employee of the Board of 
     Governors of the Federal Reserve System participates in a 
     process of setting financial standards as a part of any 
     foreign or multinational entity, the Board of Governors 
     shall--
       ``(A) issue a notice of the process, including the subject 
     matter, scope, and goals of the process, to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(B) make such notice available to the public, including 
     on the website of the Board of Governors; and
       ``(C) solicit public comment, and consult with the 
     committees described under subparagraph (A), with respect to 
     the subject matter, scope, and goals of the process.
       ``(2) Public reports on process.--After the end of any 
     process described under paragraph (1), the Board of Governors 
     shall issue a public report on the topics that were discussed 
     during the process and any new or revised rulemakings or 
     policy changes that the Board of Governors believes should be 
     implemented as a result of the process.
       ``(3) Notice of agreements; consultation.--At least 90 
     calendar days before any member or employee of the Board of 
     Governors of the Federal Reserve System participates in a 
     process of setting financial standards as a part of any 
     foreign or multinational entity, the Board of Governors 
     shall--
       ``(A) issue a notice of agreement to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(B) make such notice available to the public, including 
     on the website of the Board of Governors; and
       ``(C) consult with the committees described under 
     subparagraph (A) with respect to the nature of the agreement 
     and any anticipated effects such agreement will have on the 
     economy.
       ``(4) Definition.--For purposes of this subsection, the 
     term `process' shall include any official proceeding or 
     meeting on financial regulation of a recognized international 
     organization with authority to set financial standards on a 
     global or regional level, including the Financial Stability 
     Board, the Basel Committee on Banking Supervision (or a 
     similar organization), and the International Association of 
     Insurance Supervisors (or a similar organization).''.
       (b) FDIC Requirements.--The Federal Deposit Insurance Act 
     (12 U.S.C. 1811 et seq.) is amended by adding at the end the 
     following new section:

     ``SEC. 51. INTERNATIONAL PROCESSES.

       ``(a) Notice of Process; Consultation.--At least 30 
     calendar days before the Board of Directors participates in a 
     process of setting financial standards as a part of any 
     foreign or multinational entity, the Board of Directors 
     shall--
       ``(1) issue a notice of the process, including the subject 
     matter, scope, and goals of the process, to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(2) make such notice available to the public, including 
     on the website of the Corporation; and
       ``(3) solicit public comment, and consult with the 
     committees described under paragraph (1), with respect to the 
     subject matter, scope, and goals of the process.
       ``(b) Public Reports on Process.--After the end of any 
     process described under subsection (a), the Board of 
     Directors shall issue a public report on the topics that were 
     discussed at the process and any new or revised rulemakings 
     or policy changes that the Board of Directors believes should 
     be implemented as a result of the process.
       ``(c) Notice of Agreements; Consultation.--At least 90 
     calendar days before the Board of Directors participates in a 
     process of setting financial standards as a part of any 
     foreign or multinational entity, the Board of Directors 
     shall--
       ``(1) issue a notice of agreement to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(2) make such notice available to the public, including 
     on the website of the Corporation; and
       ``(3) consult with the committees described under paragraph 
     (1) with respect to the nature of the agreement and any 
     anticipated effects such agreement will have on the economy.
       ``(d) Definition.--For purposes of this section, the term 
     `process' shall include any official proceeding or meeting on 
     financial regulation of a recognized international 
     organization with authority to set financial standards on a 
     global or regional level, including the Financial Stability 
     Board, the Basel Committee on Banking Supervision (or a 
     similar organization), and the International Association of 
     Insurance Supervisors (or a similar organization).''.
       (c) Treasury Requirements.--Section 325 of title 31, United 
     States Code, is amended by adding at the end the following 
     new subsection:
       ``(d) International Processes.--
       ``(1) Notice of process; consultation.--At least 30 
     calendar days before the Secretary participates in a process 
     of setting financial standards as a part of any foreign or 
     multinational entity, the Secretary shall--
       ``(A) issue a notice of the process, including the subject 
     matter, scope, and goals of the process, to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(B) make such notice available to the public, including 
     on the website of the Department of the Treasury; and
       ``(C) solicit public comment, and consult with the 
     committees described under subparagraph (A), with respect to 
     the subject matter, scope, and goals of the process.
       ``(2) Public reports on process.--After the end of any 
     process described under paragraph (1), the Secretary shall 
     issue a public report on the topics that were discussed at 
     the process and any new or revised rulemakings or policy 
     changes that the Secretary believes should be implemented as 
     a result of the process.
       ``(3) Notice of agreements; consultation.--At least 90 
     calendar days before the Secretary participates in a process 
     of setting financial standards as a part of any foreign or 
     multinational entity, the Secretary shall--
       ``(A) issue a notice of agreement to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(B) make such notice available to the public, including 
     on the website of the Department of the Treasury; and
       ``(C) consult with the committees described under 
     subparagraph (A) with respect to the nature of the agreement 
     and any anticipated effects such agreement will have on the 
     economy.
       ``(4) Definition.--For purposes of this subsection, the 
     term `process' shall include any official proceeding or 
     meeting on financial regulation of a recognized international 
     organization with authority to set financial standards on a 
     global or regional level, including the Financial Stability 
     Board, the Basel Committee on Banking Supervision (or a 
     similar organization), and the International Association of 
     Insurance Supervisors (or a similar organization).''.
       (d) OCC Requirements.--Chapter one of title LXII of the 
     Revised Statutes of the United States (12 U.S.C. 21 et seq.) 
     is amended--
       (1) by adding at the end the following new section:

     ``SEC. 5156B. INTERNATIONAL PROCESSES.

       ``(a) Notice of Process; Consultation.--At least 30 
     calendar days before the Comptroller of the Currency 
     participates in a process of setting financial standards as a 
     part of any foreign or multinational entity, the Comptroller 
     of the Currency shall--
       ``(1) issue a notice of the process, including the subject 
     matter, scope, and goals of the process, to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(2) make such notice available to the public, including 
     on the website of the Office of the Comptroller of the 
     Currency; and
       ``(3) solicit public comment, and consult with the 
     committees described under paragraph (1), with respect to the 
     subject matter, scope, and goals of the process.
       ``(b) Public Reports on Process.--After the end of any 
     process described under subsection (a), the Comptroller of 
     the Currency shall issue a public report on the topics that 
     were discussed at the process and any new or revised 
     rulemakings or policy changes that the Comptroller of the 
     Currency believes should be implemented as a result of the 
     process.
       ``(c) Notice of Agreements; Consultation.--At least 90 
     calendar days before the Comptroller of the Currency 
     participates in a process of setting financial standards as a 
     part of any foreign or multinational entity, the Board of 
     Directors shall--
       ``(1) issue a notice of agreement to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(2) make such notice available to the public, including 
     on the website of the Office of the Comptroller of the 
     Currency; and

[[Page 18464]]

       ``(3) consult with the committees described under paragraph 
     (1) with respect to the nature of the agreement and any 
     anticipated effects such agreement will have on the economy.
       ``(d) Definition.--For purposes of this section, the term 
     `process' shall include any official proceeding or meeting on 
     financial regulation of a recognized international 
     organization with authority to set financial standards on a 
     global or regional level, including the Financial Stability 
     Board, the Basel Committee on Banking Supervision (or a 
     similar organization), and the International Association of 
     Insurance Supervisors (or a similar organization).''; and
       (2) in the table of contents for such chapter, by adding at 
     the end the following new item:

``5156B. International processes.''.
       (e) Securities and Exchange Commission Requirements.--
     Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 
     78d) is amended by adding at the end the following new 
     subsection:
       ``(j) International Processes.--
       ``(1) Notice of process; consultation.--At least 30 
     calendar days before the Commission participates in a process 
     of setting financial standards as a part of any foreign or 
     multinational entity, the Commission shall--
       ``(A) issue a notice of the process, including the subject 
     matter, scope, and goals of the process, to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(B) make such notice available to the public, including 
     on the website of the Commission; and
       ``(C) solicit public comment, and consult with the 
     committees described under subparagraph (A), with respect to 
     the subject matter, scope, and goals of the process.
       ``(2) Public reports on process.--After the end of any 
     process described under paragraph (1), the Commission shall 
     issue a public report on the topics that were discussed at 
     the process and any new or revised rulemakings or policy 
     changes that the Commission believes should be implemented as 
     a result of the process.
       ``(3) Notice of agreements; consultation.--At least 90 
     calendar days before the Commission participates in a process 
     of setting financial standards as a part of any foreign or 
     multinational entity, the Commission shall--
       ``(A) issue a notice of agreement to the Committee on 
     Financial Services of the House of Representatives and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate;
       ``(B) make such notice available to the public, including 
     on the website of the Commission; and
       ``(C) consult with the committees described under 
     subparagraph (A) with respect to the nature of the agreement 
     and any anticipated effects such agreement will have on the 
     economy.
       ``(4) Definition.--For purposes of this subsection, the 
     term `process' shall include any official proceeding or 
     meeting on financial regulation of a recognized international 
     organization with authority to set financial standards on a 
     global or regional level, including the Financial Stability 
     Board, the Basel Committee on Banking Supervision (or a 
     similar organization), and the International Association of 
     Insurance Supervisors (or a similar organization).''.

     SEC. 11. AMENDMENTS TO POWERS OF THE BOARD OF GOVERNORS OF 
                   THE FEDERAL RESERVE SYSTEM.

       (a) In General.--Section 13(3) of the Federal Reserve Act 
     (12 U.S.C. 343(3)) is amended--
       (1) in subparagraph (A)--
       (A) by inserting ``that pose a threat to the financial 
     stability of the United States'' after ``unusual and exigent 
     circumstances''; and
       (B) by inserting ``and by the affirmative vote of not less 
     than nine presidents of the Federal reserve banks'' after 
     ``five members'';
       (2) in subparagraph (B)--
       (A) in clause (i), by inserting at the end the following: 
     ``Federal reserve banks may not accept equity securities 
     issued by the recipient of any loan or other financial 
     assistance under this paragraph as collateral. Not later than 
     6 months after the date of enactment of this sentence, the 
     Board shall, by rule, establish--

       ``(I) a method for determining the sufficiency of the 
     collateral required under this paragraph;
       ``(II) acceptable classes of collateral;
       ``(III) the amount of any discount of such value that the 
     Federal reserve banks will apply for purposes of calculating 
     the sufficiency of collateral under this paragraph; and
       ``(IV) a method for obtaining independent appraisals of the 
     value of collateral the Federal reserve banks receive.''; and

       (B) in clause (ii)--
       (i) by striking the second sentence; and
       (ii) by inserting after the first sentence the following: 
     ``A borrower shall not be eligible to borrow from any 
     emergency lending program or facility unless the Board and 
     all federal banking regulators with jurisdiction over the 
     borrower certify that, at the time the borrower initially 
     borrows under the program or facility, the borrower is not 
     insolvent.'';
       (3) by inserting ``financial institution'' before 
     ``participant'' each place such term appears;
       (4) in subparagraph (D)(i), by inserting ``financial 
     institution'' before ``participants''; and
       (5) by adding at the end the following new subparagraphs:
       ``(F) Penalty rate.--
       ``(i) In general.--Not later than 6 months after the date 
     of enactment of this subparagraph, the Board shall, with 
     respect to a recipient of any loan or other financial 
     assistance under this paragraph, establish by rule a minimum 
     interest rate on the principal amount of any loan or other 
     financial assistance.
       ``(ii) Minimum interest rate defined.--In this 
     subparagraph, the term `minimum interest rate' shall mean the 
     sum of--

       ``(I) the average of the secondary discount rate of all 
     Federal Reserve banks over the most recent 90-day period; and
       ``(II) the average of the difference between a distressed 
     corporate bond yield index (as defined by rule of the Board) 
     and a bond yield index of debt issued by the United States 
     (as defined by rule of the Board) over the most recent 90-day 
     period.

       ``(G) Financial institution participant defined.--For 
     purposes of this paragraph, the term `financial institution 
     participant'--
       ``(i) means a company that is predominantly engaged in 
     financial activities (as defined in section 102(a) of the 
     Dodd-Frank Wall Street Reform and Consumer Protection Act (12 
     U.S.C. 5311(a))); and
       ``(ii) does not include an agency described in subparagraph 
     (W) of section 5312(a)(2) of title 31, United States Code, or 
     an entity controlled or sponsored by such an agency.''.
       (b) Conforming Amendment.--Section 11(r)(2)(A) of such Act 
     is amended--
       (1) in clause (ii)(IV), by striking ``; and'' and inserting 
     a semicolon;
       (2) in clause (iii), by striking the period at the end and 
     inserting ``; and''; and
       (3) by adding at the end the following new clause:
       ``(iv) the available members secure the affirmative vote of 
     not less than nine presidents of the Federal reserve 
     banks.''.

     SEC. 12. INTEREST RATES ON BALANCES MAINTAINED AT A FEDERAL 
                   RESERVE BANK BY DEPOSITORY INSTITUTIONS 
                   ESTABLISHED BY FEDERAL OPEN MARKET COMMITTEE.

       Subparagraph (A) of section 19(b)(12) of the Federal 
     Reserve Act (12 U.S.C. 461(b)(12)(A)) is amended by inserting 
     ``established by the Federal Open Market Committee'' after 
     ``rate or rates''.

     SEC. 13. AUDIT REFORM AND TRANSPARENCY FOR THE BOARD OF 
                   GOVERNORS OF THE FEDERAL RESERVE SYSTEM.

       (a) In General.--Notwithstanding section 714 of title 31, 
     United States Code, or any other provision of law, the 
     Comptroller General of the United States shall complete an 
     audit of the Board of Governors of the Federal Reserve System 
     and the Federal reserve banks under subsection (b) of such 
     section 714 within 12 months after the date of the enactment 
     of this Act.
       (b) Report.--
       (1) In general.--Not later than 90 days after the audit 
     required pursuant to subsection (a) is completed, the 
     Comptroller General--
       (A) shall submit to Congress a report on such audit; and
       (B) shall make such report available to the Speaker of the 
     House, the majority and minority leaders of the House of 
     Representatives, the majority and minority leaders of the 
     Senate, the Chairman and Ranking Member of the committee and 
     each subcommittee of jurisdiction in the House of 
     Representatives and the Senate, and any other Member of 
     Congress who requests the report.
       (2) Contents.--The report under paragraph (1) shall include 
     a detailed description of the findings and conclusion of the 
     Comptroller General with respect to the audit that is the 
     subject of the report, together with such recommendations for 
     legislative or administrative action as the Comptroller 
     General may determine to be appropriate.
       (c) Repeal of Certain Limitations.--Subsection (b) of 
     section 714 of title 31, United States Code, is amended by 
     striking the second sentence.
       (d) Technical and Conforming Amendments.--
       (1) In general.--Section 714 of title 31, United States 
     Code, is amended--
       (A) in subsection (d)(3), by striking ``or (f)'' each place 
     such term appears;
       (B) in subsection (e), by striking ``the third undesignated 
     paragraph of section 13'' and inserting ``section 13(3)''; 
     and
       (C) by striking subsection (f).
       (2) Federal reserve act.--Subsection (s) (relating to 
     ``Federal Reserve Transparency and Release of Information'') 
     of section 11 of the Federal Reserve Act (12 U.S.C. 248) is 
     amended--
       (A) in paragraph (4)(A), by striking ``has the same meaning 
     as in section 714(f)(1)(A) of title 31, United States Code'' 
     and inserting ``means a program or facility, including any 
     special purpose vehicle or other entity established by or on 
     behalf of the Board of Governors of the Federal Reserve 
     System or a Federal reserve bank, authorized by the Board of 
     Governors under section 13(3), that is not subject to audit 
     under section 714(e) of title 31, United States Code'';
       (B) in paragraph (6), by striking ``or in section 
     714(f)(3)(C) of title 31, United States Code, the information 
     described in paragraph (1) and information concerning the 
     transactions described in section 714(f) of such title,'' and 
     inserting ``the information described in paragraph (1)''; and
       (C) in paragraph (7), by striking ``and section 13(3)(C), 
     section 714(f)(3)(C) of title 31, United States Code, and'' 
     and inserting ``, section 13(3)(C), and''.

     SEC. 14. REPORTING REQUIREMENT FOR EXPORT-IMPORT BANK.

       The Board of Governors of the Federal Reserve System shall 
     include, as part of the monthly Federal Reserve statistical 
     release titled ``Industrial Production or Capacity 
     Utilization'' (or any successor release), an analysis of--
       (1) the impact on the index described in the statistical 
     release due to the operation of the Export-Import Bank; and
       (2) the amount of foreign industrial production supported 
     by foreign export credit agencies,

[[Page 18465]]

     using the same method used to measure industrial production 
     in the statistical release and scaled to be comparable to the 
     industrial production measurement for the United States.

     SEC. 15. MEMBERSHIP OF BOARD OF DIRECTORS OF THE FEDERAL 
                   RESERVE BANKS.

       Section 4 of the Federal Reserve Act (12 U.S.C. 302) is 
     amended--
       (1) in the eleventh undesignated paragraph (relating to 
     Class B), by striking ``and consumers'' and inserting 
     ``consumers, and traditionally underserved communities and 
     populations''; and
       (2) in the twelfth undesignated paragraph (relating to 
     Class C), by striking ``and consumers'' and inserting 
     ``consumers, and traditionally underserved communities and 
     populations''.

     SEC. 16. ESTABLISHMENT OF A CENTENNIAL MONETARY COMMISSION.

       (a) Short Title.--This section may be cited as the 
     ``Centennial Monetary Commission Act of 2015''.
       (b) Findings.--Congress finds the following:
       (1) The Constitution endows Congress with the power ``to 
     coin money, regulate the value thereof''.
       (2) Following the financial crisis known as the Panic of 
     1907, Congress established the National Monetary Commission 
     to provide recommendations for the reform of the financial 
     and monetary systems of the United States.
       (3) Incorporating several of the recommendations of the 
     National Monetary Commission, Congress created the Federal 
     Reserve System in 1913. As currently organized, the Federal 
     Reserve System consists of the Board of Governors in 
     Washington, District of Columbia, and the Federal Reserve 
     Banks organized into 12 districts around the United States. 
     The stockholders of the 12 Federal Reserve Banks include 
     national and certain State-chartered commercial banks, which 
     operate on a fractional reserve basis.
       (4) Originally, Congress gave the Federal Reserve System a 
     monetary mandate to provide an elastic currency, within the 
     context of a gold standard, in response to seasonal 
     fluctuations in the demand for currency.
       (5) Congress also gave the Federal Reserve System a 
     financial stability mandate to serve as the lender of last 
     resort to solvent but illiquid banks during a financial 
     crisis.
       (6) In 1977, Congress changed the monetary mandate of the 
     Federal Reserve System to a dual mandate for maximum 
     employment and stable prices.
       (7) Empirical studies and historical evidence, both within 
     the United States and in other countries, demonstrate that 
     price stability is desirable because both inflation and 
     deflation damage the economy.
       (8) The economic challenge of recent years--most notably 
     the bursting of the housing bubble, the financial crisis of 
     2008, and the ensuing anemic recovery--have occurred at great 
     cost in terms of lost jobs and output.
       (9) Policymakers are reexamining the structure and 
     functioning of financial institutions and markets to 
     determine what, if any, changes need to be made to place the 
     financial system on a stronger, more sustainable path going 
     forward.
       (10) The Federal Reserve System has taken extraordinary 
     actions in response to the recent economic challenges.
       (11) The Federal Open Market Committee has engaged in 
     multiple rounds of quantitative easing, providing 
     unprecedented liquidity to financial markets, while 
     committing to holding short-term interest rates low for a 
     seemingly indefinite period, and pursuing a policy of credit 
     allocation by purchasing Federal agency debt and mortgage-
     backed securities.
       (12) In the wake of the recent extraordinary actions of the 
     Federal Reserve System, Congress--consistent with its 
     constitutional responsibilities and as it has done 
     periodically throughout the history of the United States--has 
     once again renewed its examination of monetary policy.
       (13) Central in such examination has been a renewed look at 
     what is the most proper mandate for the Federal Reserve 
     System to conduct monetary policy in the 21st century.
       (c) Establishment of a Centennial Monetary Commission.--
     There is established a commission to be known as the 
     ``Centennial Monetary Commission'' (in this section referred 
     to as the ``Commission'').
       (d) Study and Report on Monetary Policy.--
       (1) Study.--The Commission shall--
       (A) examine how United States monetary policy since the 
     creation of the Board of Governors of the Federal Reserve 
     System in 1913 has affected the performance of the United 
     States economy in terms of output, employment, prices, and 
     financial stability over time;
       (B) evaluate various operational regimes under which the 
     Board of Governors of the Federal Reserve System and the 
     Federal Open Market Committee may conduct monetary policy in 
     terms achieving the maximum sustainable level of output and 
     employment and price stability over the long term, 
     including--
       (i) discretion in determining monetary policy without an 
     operational regime;
       (ii) price level targeting;
       (iii) inflation rate targeting;
       (iv) nominal gross domestic product targeting (both level 
     and growth rate);
       (v) the use of monetary policy rules; and
       (vi) the gold standard;
       (C) evaluate the use of macro-prudential supervision and 
     regulation as a tool of monetary policy in terms of achieving 
     the maximum sustainable level of output and employment and 
     price stability over the long term;
       (D) evaluate the use of the lender-of-last-resort function 
     of the Board of Governors of the Federal Reserve System as a 
     tool of monetary policy in terms of achieving the maximum 
     sustainable level of output and employment and price 
     stability over the long term; and
       (E) recommend a course for United States monetary policy 
     going forward, including--
       (i) the legislative mandate;
       (ii) the operational regime;
       (iii) the securities used in open market operations; and
       (iv) transparency issues.
       (2) Report.--Not later than December 1, 2016, the 
     Commission shall submit to Congress and make publicly 
     available a report containing a statement of the findings and 
     conclusions of the Commission in carrying out the study under 
     paragraph (1), together with the recommendations the 
     Commission considers appropriate.
       (e) Membership.--
       (1) Number and appointment.--
       (A) Appointed voting members.--The Commission shall contain 
     12 voting members as follows:
       (i) Six members appointed by the Speaker of the House of 
     Representatives, with four members from the majority party 
     and two members from the minority party.
       (ii) Six members appointed by the President Pro Tempore of 
     the Senate, with four members from the majority party and two 
     members from the minority party.
       (B) Chairman.--The Speaker of the House of Representatives 
     and the majority leader of the Senate shall jointly designate 
     one of the members of the Commission as Chairman.
       (C) Non-voting members.--The Commission shall contain 2 
     non-voting members as follows:
       (i) One member appointed by the Secretary of the Treasury.
       (ii) One member who is the president of a district Federal 
     reserve bank appointed by the Chair of the Board of Governors 
     of the Federal Reserve System.
       (2) Period of appointment.--Each member shall be appointed 
     for the life of the Commission.
       (3) Timing of appointment.--All members of the Commission 
     shall be appointed not later than 30 days after the date of 
     the enactment of this section.
       (4) Vacancies.--A vacancy in the Commission shall not 
     affect its powers, and shall be filled in the manner in which 
     the original appointment was made.
       (5) Meetings.--
       (A) Initial meeting.--The Commission shall hold its initial 
     meeting and begin the operations of the Commission as soon as 
     is practicable.
       (B) Further meetings.--The Commission shall meet upon the 
     call of the Chair or a majority of its members.
       (6) Quorum.--Seven voting members of the Commission shall 
     constitute a quorum but a lesser number may hold hearings.
       (7) Member of congress defined.--In this subsection, the 
     term ``Member of Congress'' means a Senator or a 
     Representative in, or Delegate or Resident Commissioner to, 
     the Congress.
       (f) Powers.--
       (1) Hearings and sessions.--The Commission or, on the 
     authority of the Commission, any subcommittee or member 
     thereof, may, for the purpose of carrying out this section, 
     hold hearings, sit and act at times and places, take 
     testimony, receive evidence, or administer oaths as the 
     Commission or such subcommittee or member thereof considers 
     appropriate.
       (2) Contract authority.--To the extent or in the amounts 
     provided in advance in appropriation Acts, the Commission may 
     contract with and compensate government and private agencies 
     or persons to enable the Commission to discharge its duties 
     under this section, without regard to section 3709 of the 
     Revised Statutes (41 U.S.C. 5).
       (3) Obtaining official data.--
       (A) In general.--The Commission is authorized to secure 
     directly from any executive department, bureau, agency, 
     board, commission, office, independent establishment, or 
     instrumentality of the Government, any information, including 
     suggestions, estimates, or statistics, for the purposes of 
     this section.
       (B) Requesting official data.--The head of such department, 
     bureau, agency, board, commission, office, independent 
     establishment, or instrumentality of the government shall, to 
     the extent authorized by law, furnish such information upon 
     request made by--
       (i) the Chair;
       (ii) the Chair of any subcommittee created by a majority of 
     the Commission; or
       (iii) any member of the Commission designated by a majority 
     of the commission to request such information.
       (4) Assistance from federal agencies.--
       (A) General services administration.--The Administrator of 
     General Services shall provide to the Commission on a 
     reimbursable basis administrative support and other services 
     for the performance of the functions of the Commission.
       (B) Other departments and agencies.--In addition to the 
     assistance prescribed in subparagraph (A), at the request of 
     the Commission, departments and agencies of the United States 
     shall provide such services, funds, facilities, staff, and 
     other support services as may be authorized by law.
       (5) Postal service.--The Commission may use the United 
     States mails in the same manner and under the same conditions 
     as other departments and agencies of the United States.
       (g) Commission Personnel.--

[[Page 18466]]

       (1) Appointment and compensation of staff.--
       (A) In general.--Subject to rules prescribed by the 
     Commission, the Chair may appoint and fix the pay of the 
     executive director and other personnel as the Chair considers 
     appropriate.
       (B) Applicability of civil service laws.--The staff of the 
     Commission may be appointed without regard to the provisions 
     of title 5, United States Code, governing appointments in the 
     competitive service, and may be paid without regard to the 
     provisions of chapter 51 and subchapter III of chapter 53 of 
     that title relating to classification and General Schedule 
     pay rates, except that an individual so appointed may not 
     receive pay in excess of level V of the Executive Schedule.
       (2) Consultants.--The Commission may procure temporary and 
     intermittent services under section 3109(b) of title 5, 
     United States Code, but at rates for individuals not to 
     exceed the daily equivalent of the rate of pay for a person 
     occupying a position at level IV of the Executive Schedule.
       (3) Staff of federal agencies.--Upon request of the 
     Commission, the head of any Federal department or agency may 
     detail, on a reimbursable basis, any of the personnel of such 
     department or agency to the Commission to assist it in 
     carrying out its duties under this section.
       (h) Termination of Commission.--
       (1) In general.--The Commission shall terminate on June 1, 
     2017.
       (2) Administrative activities before termination.--The 
     Commission may use the period between the submission of its 
     report and its termination for the purpose of concluding its 
     activities, including providing testimony to the committee of 
     Congress concerning its report.
       (i) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $1,000,000, 
     which shall remain available until the date on which the 
     Commission terminates.

     SEC. 17. ELIMINATION OF SURPLUS FUNDS OF FEDERAL RESERVE 
                   BANKS.

       (a) In general.--Section 7 of the Federal Reserve Act (12 
     U.S.C. 289 et seq.) is amended--
       (1) in subsection (a)--
       (A) in the heading of such subsection, by striking ``And 
     Surplus Funds''; and
       (B) In paragraph (2), by striking ``deposited in the 
     surplus fund of the bank'' and inserting ``transferred to the 
     Board of Governors of the Federal Reserve System for transfer 
     to the Secretary of the Treasury for deposit in the general 
     fund of the Treasury''; and
       (C) by striking the first subsection (b) (relating to a 
     transfer for fiscal year 2000).
       (b) Transfer to the Treasury.--The Federal Reserve banks 
     shall transfer all of the funds of the surplus funds of such 
     banks to the Board of Governers of the Federal Reserve System 
     for transfer to the Secretary of the Treasury for deposit in 
     the general fund of the Treasury.

  The Acting CHAIR. No further amendment to the bill, as amended, shall 
be in order except those printed in part C of House Report 114-341. 
Each such further amendment may be offered only in the order printed in 
the report, by a Member designated in the report, shall be considered 
as read, shall be debatable for the time specified in the report 
equally divided and controlled by the proponent and an opponent, shall 
not be subject to amendment, and shall not be subject to a demand for 
division of the question.


           Amendment No. 1 Offered by Mr. Heck of Washington

  The Acting CHAIR. It is now in order to consider amendment No. 1 
printed in part C of House Report 114-341.
  Mr. HECK of Washington. Mr. Chair, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 5, line 8, strike ``Not''.
       Page 5, line 9, insert the following:
       ``(1) In general.--Not''.
       Page 5, after line 15, insert the following:
       ``(2) Exception.--The requirements of paragraph (1) shall 
     not apply if the Federal Open Market Committee determines at 
     the end of a meeting that the current conditions represent a 
     significant divergence from the goals of maximum employment 
     and stable prices described in section 2A.''.

  The Acting CHAIR. Pursuant to House Resolution 529, the gentleman 
from Washington (Mr. Heck) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Washington.
  Mr. HECK of Washington. Mr. Chair, I yield myself 2\1/2\ minutes.
  Thus far, this has been an interesting debate that seems to have 
mostly revolved around a philosophical point. On the one hand, you have 
arguments for increased transparency and accountability. On the other 
hand, you have arguments against increased political interference by 
this institution. I have always proceeded with the assumption that 
philosophical debates are irreconcilable in a lot of regards because 
you have to presume that the other side has a point of view.
  This is not why I oppose the underlying bill. Although I hasten to 
add, why anybody would ever want to give more authority and control 
over the levers of the economy to this institution, with its track 
record in the last several years, including government shutdowns and 
the like, is beyond me. Again, it is a philosophical debate.
  Here is what is not debatable: what is proposed in this bill doesn't 
work. It does not work. Let's back up. Essentially, color it any way 
you want, this bill argues for the adoption of the so-called Taylor 
rule. What is that?
  The Taylor rule was devised by Professor Taylor of Stanford in the 
1990s, looking back at the experience of the economy and what the Fed 
had done using a mixture of GDP, GDP potential and inflation, and he 
derived a formula. The problem is, again, it does not work. That is why 
I have offered this amendment, which would provide the Fed the ability 
to opt out, if we get to a stressful situation where clearly the 
application of the Taylor rule wasn't working.
  Here is the deal. I can prove to you that the Taylor rule wouldn't 
work. Let me show you. We have had a couple of instances in recent 
history in which we can test the application of the Taylor rule, both 
against the Fed's mission to achieve price stability as well as achieve 
full employment.
  This chart tracks the years 1979 to 1983. The red line is what the 
chair of the Fed, Mr. Volcker, utilized in the way of the actual Fed 
fund rates. The blue line is the Taylor rule. You can see that for many 
years, Mr. Volcker opted for a 5-percent increase over what the Taylor 
rule would have been. You can also see that Mr. Volcker was right, that 
he broke inflation.
  Now, unless we want to return to 12 to 14 percent home mortgages and 
a
17 to 18 percent inflation rate, we should----
  The Acting CHAIR. The time of the gentleman has expired.
  Mr. HECK of Washington. I yield myself an additional 30 seconds.
  Quickly, here is the chart for the most recent economic crisis. The 
red line is what the Fed did. The Taylor rule is the blue line. This is 
unemployment.
  The Taylor rule would have provided, beginning back in 2010, 
substantially higher interest rates when unemployment rates were still 
unacceptably high. The Taylor rule doesn't work. Adopt my amendment.
  I reserve the balance of my time.

                              {time}  1845

  Mr. HENSARLING. Mr. Chairman, I claim the time in opposition to the 
amendment.
  The Acting CHAIR. The gentleman from Texas is recognized for 5 
minutes.
  Mr. HENSARLING. Mr. Chairman, I do rise in opposition to the 
amendment. The gentleman has clearly stated he doesn't like the 
underlying bill, so his amendment simply guts the underlying bill and 
allows the Fed to opt out of the underlying bill.
  I have listened carefully to the gentleman's interest and what he 
recited about the Taylor rule, but again I would encourage him to read 
the bill because he would then know, as I suspect that he does, that 
the Federal Reserve under the FORM Act is not mandated to follow the 
Taylor rule. It is simply a comparison. So, if the Taylor rule is as 
bad as the gentleman claims it will be, then the FORM Act will reveal 
that to all the world. All the world will know this.
  However, I think if we study economic history carefully, what we will 
discover is that, when the Fed used a more predictable, rules-based 
monetary policy to where investors and businesses actually had some 
idea of what interest rates would be, the economy would flourish, as it 
did during the great moderation.
  So again, the FORM Act allows the Fed to use any monetary policy it 
wishes, to change the policy, to deviate from the policy, but it has to 
communicate that to the rest. That is essentially what the FORM Act 
says. It is

[[Page 18467]]

about communication. It doesn't tell them how to conduct the policy. It 
does tell them how to communicate the policy to the American people, 
who deserve to know this from the single most important economic agency 
of government today.
  Mr. HUIZENGA of Michigan. Will the gentleman yield?
  Mr. HENSARLING. I yield to the gentleman, the author of the FORM Act.
  Mr. HUIZENGA of Michigan. I appreciate the chairman yielding to me on 
this.
  Exactly what you were talking about is the case. This is merely a 
benchmark guideline to measure against. In fact, in committee, when 
Chair Yellen was testifying in front of our committee, I suggested 
that, if they saw problems, that they would then put a floor or put a 
ceiling on any movement that could happen within that timeframe. I 
thought I gave a very helpful suggestion that we call it the Yellen 
rule at that point, and she can claim credit for doing exactly what is 
being discussed.
  Mr. HENSARLING. Well, I thank the gentleman for his leadership on 
this.
  Again, I have portions of the act in front of me. The bill 
stipulates: ``Nothing in this Act shall be construed to require.'' That 
is what the act says on a formal policy directive. ``If the Federal 
Open Market Committee determines that such plans cannot or should not 
be achieved due to changing market conditions.''
  Again this is about communication. When we have an economy that is 
underperforming, where had we only had the average recovery in the 
post-war era every man, woman, and child in America would have $6,000 
more, millions would be back to work, I think the American people 
deserve to ask some hard questions.
  This is such an incredible red herring with this argument on 
independence. Mr. Chairman, the Board of Governors have 14-year terms--
second only to lifetime appointments to the bench--14-year terms, 
independent funding of the congressional appropriations process. And so 
now we don't want them to answer some questions.
  Will their feelings get hurt if they are asked some tough questions 
by Members of Congress? Are they that delicate that they can't conduct 
monetary policy if in an open committee hearing they have to answer 
questions? I think the American people, Mr. Chairman, are saying: Give 
me a break.
  Mr. Chairman, I reserve the balance of my time.
  Mr. HECK of Washington. Mr. Chairman, I yield myself 1\1/2\ minutes.
  Where is it? Bring it. If it is not the Taylor rule, it is some other 
rule that is going to work magically to achieve price stability and 
full employment, you think it exists somewhere?
  The Taylor rule is what is essentially referenced in the bill. You 
say: But it isn't required.
  Okay. There is a better rule? Show your hand. It is time to lay your 
cards down. If there is actually some kind of mathematical magic 
formula that can always trump human judgment and changing economic 
circumstances, lay it on the table. But you haven't done it.
  Mr. HENSARLING. Will the gentleman yield?
  Mr. HECK of Washington. I would be glad to yield to the gentleman 
from Texas out of my extreme respect for both you and the prime sponsor 
of the bill.
  Mr. HENSARLING. Whether you call it a rule or a method or approach, 
the Fed is already doing something. They are looking at variables, and 
they are making decisions. All we are asking is that they communicate 
that to the rest of the American people. Ask them what their rule is. 
We would like to know. That is what the FORM Act is all about.
  Mr. HECK of Washington. Their rule is to break the back of inflation. 
Their rule is to achieve increased employment. That is the rule they 
use. Exercising, yes, judgment based upon ever-changing economic 
circumstances.
  But to suggest that you can arbitrarily apply a formula without being 
willing to advance the formula, you want disclosure, you want 
transparency? Start with you. Put your rule on the table.
  I reserve the balance of my time.
  Mr. HENSARLING. Again, it is up to the Fed. You can't argue this both 
ways. The FORM Act is not imposing a rule. The Fed says that it is data 
dependent. What is the data? What is the reaction function? Tell us 
what you are doing. If you decide tomorrow morning you want to do it 
differently, that is fine. Just tell the rest of us.
  In this economy that continues to underperform, an economy that 
continues to suffer, monetary policy ought to be made clear and 
transparent to the American people. That is what the FORM Act demands.
  I yield the remaining 15 seconds to the gentleman from Michigan (Mr. 
Huizenga).
  Mr. HUIZENGA of Michigan. Mr. Chairman, I don't trust Congress enough 
for us to come up with the rule, which is why I wrote into the bill 
that the Fed develops the rule, the guideline, the benchmark that they 
put forward. We know they do this already. They look at the Taylor 
rule, they look at a number of other models, and they then go advance 
forward with the best policy that they think is the right thing. We are 
just asking them to communicate that to Congress and the American 
people.
  Mr. HENSARLING. Mr. Chairman, I urge a rejection of the amendment.
  I yield back the balance of my time.
  Mr. HECK of Washington. Mr. Chairman, with all due respect to my 
friend from Michigan, you didn't put the formula in the bill because it 
doesn't exist. If it did, you would have put it in. If there would have 
been an absolute magic formula that would keep this economy at full 
employment and price stability, we would have it on the table, but no 
such formula exists. That is why you didn't put it in the bill. It 
doesn't exist.
  Adopt the amendment. Allow the Fed to do the job to achieve price 
stability and full employment.
  I yield back the balance of my time.
  The Acting CHAIR (Mr. Woodall). The question is on the amendment 
offered by the gentleman from Washington (Mr. Heck).
  The amendment was rejected.


           Amendment No. 2 Offered by Mr. Heck of Washington

  The Acting CHAIR. It is now in order to consider amendment No. 2 
printed in part C of House Report 114-341.
  Mr. HECK of Washington. Mr. Chairman, I have an amendment at the 
desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 6, line 25, strike ``and''.
       Page 7, line 3, strike the period at the end and insert ``; 
     and''.
       Page 7, after line 3, insert the following:
       ``(9) include a plan to use the most accurate data, subject 
     to all historical revisions, for inputs into the Directive 
     Policy Rule and the Reference Policy Rule.''.

  The Acting CHAIR. Pursuant to House Resolution 529, the gentleman 
from Washington (Mr. Heck) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Washington.
  Mr. HECK of Washington. Mr. Chairman, I yield myself such time as I 
may consume.
  Mr. Chairman, the purpose of this amendment is to ask the Fed to 
build a time machine because, frankly, that is the only way that this 
bill works.
  You see, the fact of the matter is that, when Mr. Taylor, Professor 
Taylor, devised his study, which was groundbreaking, was important, he 
did so in the 1990s, looking back over the previous 10 years which, as 
I indicated earlier, was an unusually fairly stable period of time, 
unusually fairly stable, not an exceptional performance, good or bad, 
in the economy.
  He did so with the benefit of data that had been updated over time, 
because, you see, the Bureau of Economic Analysis doesn't just do one 
fixed number that people get to rely on. In fact, in the first year 
they put out not one, not two, but three updates, called the advanced 
estimate, the preliminary estimate, and the final estimate.
  But wait, there is more, to quote the Ronco ad. The next year they 
update again. That is called the annual reestimate. But wait, there is 
more. Every 5

[[Page 18468]]

years they do a benchmark reestimate. That is the data that Professor 
Taylor had the advantage of.
  In essence, to ask the Fed to utilize or apply the Taylor rule or any 
such thing like it, which does not exist, is to ask them to have the 
benefit of data which is not final.
  I don't know about you, but every month when the unemployment numbers 
come out, I have begun to view them pretty skeptically over the years. 
We all know the reason for that: because they get revised so much--so 
much.
  At the beginning of President Obama's first term, when he indicated, 
as is often cited, that he would act to get unemployment no higher than 
8 percent, he was doing so on the basis of the first estimate, which 
said it was 6.7 percent or something like that. The revision was 7.8 
percent 3 months later.
  So the fact of the matter is the Taylor rule or anything like it has 
the advantage of hindsight, which no rule can fully incorporate.
  The purpose of this amendment--vote for it, vote against it--is if 
you want to do this, build yourself a time machine, because that is the 
only way you can reasonably, with any sense of scholarship and solid 
research, be able to devise a formula that would work because we don't 
know the conditions until quite sometime later.
  Mr. Chairman, I reserve the balance of my time.
  Mr. HENSARLING. Mr. Chairman, I ask unanimous consent to claim the 
time in opposition to the amendment, although I am not opposed.
  The Acting CHAIR. Is there objection to the request of the gentleman 
from Texas?
  There was no objection.
  The Acting CHAIR. The gentleman from Texas is recognized for 5 
minutes.
  Mr. HENSARLING. Mr. Chairman, just to throw my friend and colleague a 
curve ball, I will support his amendment. Although, I must admit, I am 
somewhat surprised and shocked, given the debate of the last, that he 
would want to interfere in the independence of the Fed and require them 
to use fully revised data.
  I will, nonetheless, support the amendment, notwithstanding the 
intrusion upon their independence.
  Mr. Chairman, I yield back the balance of my time.
  Mr. HECK of Washington. Mr. Chairman, I am not often speechless in 
the face of my friend from Texas' remarks.
  Look, we cannot perform a calculation without accurate data. If you 
are going to join me and throw in with H. G. Wells and a great heritage 
of both literature and cinema history regarding time travel, then I can 
do nothing but shockingly accept your gracious support of this 
amendment.
  Mr. Chairman, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Washington (Mr. Heck).
  The amendment was agreed to.


                 Amendment No. 3 Offered by Mr. Grayson

  The Acting CHAIR. It is now in order to consider amendment No. 3 
printed in part C of House Report 114-341.
  Mr. GRAYSON. Mr. Chairman, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 44, line 25, insert ``annually'' after ``shall''.
       Page 45, line 7, strike ``the audit'' and insert ``each 
     audit''.

  The Acting CHAIR. Pursuant to House Resolution 529, the gentleman 
from Florida (Mr. Grayson) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Florida.
  Mr. GRAYSON. Mr. Chairman, my amendment would simply make the one-
time audit required by section 13 of this bill an annual audit. A 2011 
GAO audit of the Fed, the only independent Fed audit in its 102-year 
history, detailed how the United States provided at least $16 trillion 
in loans to bail out American and foreign banks and businesses.
  With an annual audit, Congress is at a great advantage in how to 
avoid waste, fraud, and abuse at the Fed. I urge my colleagues to 
support this amendment.
  Mr. Chairman, I reserve the balance of my time.
  Mr. HENSARLING. Mr. Chairman, I ask unanimous consent to claim the 
time in opposition to the amendment, although I am not opposed.
  The Acting CHAIR. Is there objection to the request of the gentleman 
from Texas?
  There was no objection.
  The Acting CHAIR. The gentleman from Texas is recognized for 5 
minutes.
  Mr. HENSARLING. Mr. Chairman, I want to thank the gentleman from 
Florida for his amendment. I rise in support of the amendment.
  The FORM Act provides for GAO audits of the Federal Reserve but is 
silent as to the frequency of when audits should occur. I think the 
gentleman makes a compelling case.
  This will clarify that GAO should audit the Fed on an annual basis, 
and it will serve to help inform Congress and the American people with 
regular updates on the Fed's activities. It will promote greater 
transparency and accountability, which is the objective of the bill.
  I urge all Members to adopt the amendment. I thank the gentleman for 
his leadership here.
  Mr. Chairman, I yield back the balance of my time.
  Mr. GRAYSON. Mr. Chairman, I yield back the balance of my time.

                              {time}  1900

  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Florida (Mr. Grayson).
  The amendment was agreed to.
  The Acting CHAIR. It is now in order to consider amendment No. 4 
printed in part C of House Report 114-341.


                 Amendment No. 5 Offered by Mr. Grayson

  The Acting CHAIR. It is now in order to consider amendment No. 5 
printed in part C of House Report 114-341.
  Mr. GRAYSON. Mr. Chairman, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Add at the end of the bill the following:

     SEC. 17. AMENDMENT TO FEDERAL RESERVE DISTRICTS.

       (a) In General.--Section 2 of the Federal Reserve Act, (12 
     U.S.C. 222 et seq.) is amended--
       (1) by striking ``twelve'' each place such term appears and 
     inserting ``fifteen'';
       (2) by inserting after the fourth sentence the following: 
     ``One such Federal reserve districts shall be for Northern 
     California (located in San Francisco), one such district 
     shall be for Southern California (located in Los Angeles), 
     and one such district shall be for Florida (located in 
     Orlando). The border between the two California districts 
     shall be drawn so that the districts are contiguous and 
     compact, the population of the districts is approximately 
     equal, and the districts do not divide any California county 
     border as in existence on the date of enactment of this 
     sentence.''
       (b) Conforming Amendments.--Section 16 of such Act is 
     amended by striking ``twelve'' and inserting ``fifteen''.

  The Acting CHAIR. Pursuant to House Resolution 529, the gentleman 
from Florida (Mr. Grayson) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Florida.
  Mr. GRAYSON. Mr. Chairman, my amendment would increase the number of 
Federal Reserve Districts from 12 to 15. The three new districts would 
be for northern California, southern California, and Florida; based in 
San Francisco, Los Angeles, and Orlando. No current Federal Reserve 
banks would be relocated as a result.
  Take a look at the map to my right and you will see a map that is 
over a century old. The Federal Reserve Districts have not been updated 
significantly since they were first established in 1913--102 years ago. 
It is time to bring our Federal Reserve Districts into the 21st 
century.
  Right now, for instance, one district represents everywhere from Utah 
to the Pacific Ocean, including Alaska and Hawaii. The three new 
districts would be centered in three of the fastest growing regions of 
our country in terms of both population and economic growth.
  In 1913, the 12th district, based in San Francisco, had only 6 
percent of the

[[Page 18469]]

population of the United States. In 2000, it had 19 percent, or 65 
million Americans.
  As you can see from the next chart, districts designed originally a 
century ago to have equal population have reached the point where one 
district has 10 times the population of another district.
  In the case of the Western district, it now includes a total of nine 
States jumbled together, California and eight surrounding States. 
Similarly, the district including Florida and the neighboring States 
has grown to 45 million Americans--twice the average. It combines 
Florida and five neighboring States. It is time for the Fed to 
recognize this change in where Americans live.
  A similar change has been made in the court systems over the year. 
The tenth circuit was taken out of the eighth circuit when the 
population increased to the point where it was no longer sustainable as 
a single circuit court.
  Similarly, the 11th circuit--my circuit--was carved out of the fifth 
circuit for exactly the same reason. But the Fed districts have 
remained static now for a century.
  I am proud to introduce this amendment to modernize the Federal 
Service to more accurately reflect who we are as Americans and where we 
live and where we work.
  I yield to the gentlewoman from California (Ms. Maxine Waters).
  Ms. MAXINE WATERS of California. Mr. Chair, while I appreciate the 
spirit of the amendment, which seeks to ensure that the most populous 
regions of the country have adequate representation within the Federal 
Reserve system, I am concerned that the amendment does not fully 
contemplate the implications of adding the additional reserve 
districts.
  For example, the amendment would add a Federal Reserve District 
headquartered in San Francisco, a city which is already home to a 
Federal Reserve bank. Furthermore, the current Federal Reserve Bank of 
San Francisco has a number of branches located throughout the West, 
including one in Los Angeles, a city which would be home to another 
Federal Reserve Bank under the gentleman from Florida's amendment.
  The amendment also does not address how the new Reserve Banks would 
participate in the current rotation on the Federal Open Market 
Committee, a matter which is prescribed by law under section 12(a) of 
the Federal Reserve Act.
  Rather than add an additional Reserve Bank or additional Reserve 
Banks to the Federal Reserve system, I respectfully submit that the 
desired effects of this amendment to provide greater diverse range of 
views across our country could more usefully be achieved without 
increasing the number of regional Reserve Banks and within the confines 
of the current system.
  The Acting CHAIR. The time of the gentleman from Florida has expired.
  Mr. HENSARLING. Mr. Chairman, I rise in opposition to the amendment.
  The Acting CHAIR. The gentleman from Texas is recognized for 5 
minutes.
  Mr. HENSARLING. Mr. Chairman, I want to--I guess to put it civilly--
gently oppose the amendment from the gentleman from Florida.
  I think the gentleman from Florida does make some good points. These 
Federal Reserve Districts, in some respects, are anachronistic. They 
were derived from our early 20th century history. I do believe that it 
is a subject that needs to be looked at. I am just not prepared to say 
today that the gentleman has necessarily gotten it right.
  There is probably something very humorous today about siting a 
Federal Reserve Bank in the same city as Disney World. I will refrain 
from making any such humorous references.
  But, again, I think the gentleman makes a good point. I would like 
this issue to go through regular order. I believe it is a matter that 
Chairman Huizenga and the Monetary Policy and Trade Subcommittee of our 
full committee will be taking a look at: Are these appropriate cities 
for the Federal Reserve Banks to be sited?
  So, again, I thank the gentleman for bringing the matter to the 
House's attention, I thank him for bringing it to my attention, but I 
am not prepared to say that San Francisco, L.A., or Orlando are 
necessarily the places that Federal Reserve Banks ought to end up, 
without going through regular order.
  So I want to look at the matter, but I would otherwise encourage 
Members at this time to reject the amendment of the gentleman from 
Florida. I would ask the House to reject the amendment at this time.
  Mr. Chairman, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Florida (Mr. Grayson).
  The amendment was rejected.


              Amendment No. 6 Offered by Mr. King of Iowa

  The Acting CHAIR. It is now in order to consider amendment No. 6 
printed in part C of House Report 114-341.
  Mr. KING of Iowa. Mr. Chairman, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Add at the end the following:

     SEC. 17. PUBLIC TRANSCRIPTS OF FOMC MEETINGS.

       Section 12A of the Federal Reserve Act (12 U.S.C. 263), as 
     amended by this Act, is further amended by adding at the end 
     the following:
       ``(e) Public Transcripts of Meetings.--The Committee 
     shall--
       ``(1) record all meetings of the Committee; and
       ``(2) make the full transcript of such meetings available 
     to the public.''.

  The Acting CHAIR. Pursuant to House Resolution 529, the gentleman 
from Iowa (Mr. King) and a Member opposed each will control 5 minutes.
  The Chair recognizes the gentleman from Iowa.
  Mr. KING of Iowa. Mr. Chairman, amendment No. 6 is an amendment that 
addresses the transparency that we have heard much dialogue about in 
the debate here on the floor, especially from members of the Financial 
Services Committee.
  It is an amendment that requires that the records of the Federal Open 
Market Committee be recorded, in the same fashion that our committee 
meetings are recorded, and made public.
  The FOMC sets the monetary policy for the U.S. economy, but there is 
no law that compels the Fed to release FOMC meeting transcripts to the 
public. The details of the meetings are crucial for an accurate 
understanding of how the Fed views the state of the economy and the 
reasoning behind Fed policy and actions. That has also been a 
significant part of our debate here with the underlying bill.
  So, my amendment directs them to keep a transcript, keep a record, 
and make that record public. It compels those transcripts to be made 
public so that those of us here in the United States Congress, but also 
people in households and businesses across the country, can have a look 
into the decisions that are made and especially the rationale behind 
those decisions of the full proceedings of the Federal Open Market 
Committee.
  Every congressional hearing makes these transcripts publicly 
available. That is what my amendment does. It requires the FOMC to do 
the same. And I would urge its adoption.
  Mr. Chairman, I reserve the balance of my time.
  Ms. MAXINE WATERS of California. Mr. Chairman, I rise in opposition 
to the gentleman's amendment.
  The Acting CHAIR (Mr. Jody B. Hice of Georgia). The gentlewoman is 
recognized for 5 minutes.
  Ms. MAXINE WATERS of California. Mr. Chair, the amendment would, at 
best, duplicate the Federal Reserve's current policy regarding the 
disclosure of transcripts and, at worst, falsely imply that the Federal 
Reserve would be prohibited from exercising its discretion in 
determining when to release FOMC meeting transcripts in accordance with 
prudent monetary policy. After all, communication in and of itself is a 
key monetary policy tool, and it would be unwise to tie the Fed's hands 
when it comes to using it.

[[Page 18470]]

  Furthermore, any failure to allow the Federal Reserve to strike the 
appropriate balance between transparency and the disclosure of 
potentially market-moving information, particularly at a time of 
financial stress, would have significant adverse impacts on our economy 
and could, in turn, have a chilling effect on monetary policy 
deliberations.
  To underscore the fact that this potentially harmful amendment is 
completely unnecessary, I think it is also worth pointing out that the 
Federal Reserve is already a leader among central banks in advanced 
economies when it comes to making its transcripts available to the 
public.
  While the Federal Reserve releases transcripts with a 5-year lag, 
other advanced economies have adopted requirements to release 
transcripts after much longer periods. Japan's Central Bank releases 
transcripts to the public after 10 years, and the European Union 
releases transcripts after 20 years.
  In addition to releasing transcripts to the public, the Federal 
Reserve employs a range of additional measures to enhance the public's 
understanding of the Federal Open Market Committee's views and 
expectations. For example, the Federal Reserve issues a statement 
following the conclusion of each of its meetings that includes the 
Federal Reserve's policy decisions and its rationale, includes the vote 
of each FOMC member, and provides a short summary of any dissenting 
views.
  The Federal Reserve also releases detailed minutes that are released 
on a 3-week lag following each FOMC meeting. The minutes contain a 
detailed discussion of the policy deliberations and the range of views 
that were presented and includes votes on each policy action taken by 
each FOMC member.
  Since 2011, the Chair of the Federal Reserve gives a press conference 
following each FOMC meeting for which a summary of economic projections 
is prepared, amounting to four press conferences each year. This 
provides the opportunity for the Chair to explain her views and respond 
to questions from the financial press.
  In January 2012, the Federal Open Market Committee also published a 
statement of longer-run goals and monetary policy strategy in which it 
outlined how it would assess its compliance with statutory mandates to 
promote full employment and price stability. Subsequently, in September 
2014, the Federal Reserve published a statement outlining its policy, 
normalization principles, and plans.
  Finally, the Federal Reserve, as it is required by law, regularly 
testifies before the House and Senate on monetary policy matters on no 
less than two occasions a year. Chairman Yellen has made herself 
available to testify on regulatory matters at the request of Congress.
  So, all of this is to say that claims that the Federal Reserve lacks 
transparency or doesn't communicate its thinking to the public just 
don't hold up to the facts.
  I urge Members to oppose this amendment.
  Mr. Chairman, I reserve the balance of my time.


      Modification to Amendment No. 6 Offered by Mr. King of Iowa

  Mr. KING of Iowa. Mr. Chairman, I ask unanimous consent to modify my 
amendment with the form I have placed at the desk.
  The Acting CHAIR. The Clerk will report the modification.
  The Clerk read as follows:
  Modification to amendment No. 6 offered by Mr. King of Iowa:
       Add at the end the following:
       Page 53, line 4, strike ``and''.
       Page 53, line 11, strike the period and insert ``; and''.
       Page 53, after line 11, insert the following:
       (F) consider the effects of the GDP output and employment 
     targets of the ``dual mandate'' (both from the creation of 
     the dual mandate in 1977 until the present time and estimates 
     of the future effect of the dual mandate ) on--
       (i) United States economic activity;
       (ii) Federal Reserve actions; and
       (iii) Federal debt.
       Page 53, line 18, add at the end the following: ``In making 
     such report, the Commission shall specifically report on the 
     considerations required under paragraph (1)(F).''.

                              {time}  1915

  The Acting CHAIR. Is there objection to the request of the gentleman 
from Iowa?
  There was no objection.
  The Acting CHAIR. The amendment is modified.
  The Chair recognizes the gentleman from Iowa.
  Mr. KING of Iowa. Mr. Chairman, I want to thank the ranking member 
for her cooperation and opportunity to have this debate, and I will 
just address it briefly.
  In 1977, Congress established what is known as the dual mandate. The 
dual mandate set the goals of the Federal Reserve System and the 
Federal Open Market Committee to include goals of maximum employment 
and stable prices.
  There has been a lot of debate about whether the tension of those two 
issues has brought about decisions of the Fed that might have otherwise 
been different, and so this amendment requires a study to be done in 
order to take a look at the effects of the dual mandate. It is pretty 
simple that way, and I urge its support and adoption.
  I circle back then to the transcripts. And in response to the 
gentlewoman's comments, I would just remind Members of Congress that we 
do keep records in all of our proceedings. There is a transcript taking 
place right now of these proceedings, of each of our committees and 
subcommittees. They are available to the public, and, in fact, we are 
on C-SPAN with almost all of our subcommittees and committees today.
  We are open. We are open records, and there is much sunlight on what 
we do. And yet, many of the decisions that we make here have far less 
impact on the American citizen than the decisions made by the Fed.
  So, again, I urge the adoption of this modified amendment.
  I reserve the balance of my time.
  Ms. MAXINE WATERS of California. Mr. Chair, continuing time in 
opposition, first, the notion that the Federal Reserve's large-scale 
asset purchases did not help the economy and job growth is simply 
false. The forceful and sustained actions that the Federal Reserve took 
in recent years to bring us out of a recession and into recovery are 
well-documented and cannot be overlooked.
  For instance, the November jobs report showed the economy added a 
whopping 271,000 jobs in October, pushing the unemployment rate down 
and, even further, to 5 percent and bringing the total number of 
private sector jobs created to more than 13.3 million over the past 68 
months.
  Second, the amendment's implication that the Federal Reserve's 
monetary policy has added to the U.S. national debt is also 
demonstrably false. Although raising revenue is not the purpose of 
monetary policy, as a consequence of the Federal Reserve's actions in 
recent years, it has generated substantial sums in the hundreds of 
billions of dollars which has returned to the Treasury. These sums have 
reduced the deficit, not contributed to it.
  Rather than relentlessly attacking the Federal Reserve and taking 
steps to undermine their independence, all of us really should be 
thanking them for what they have done to get our economy back on track.
  I yield back the balance of my time.
  Mr. KING of Iowa. Mr. Chairman, I yield such time as he may consume 
to the gentleman from Texas (Mr. Hensarling).
  Mr. HENSARLING. I thank the gentleman for yielding.
  I want to urge all Members of the House to adopt his amendment. With 
respect to full transcripts of the FOMC meetings, all this is doing is 
simply codifying a current practice. It is simply to make sure that 
there is a transparency, at least this level of transparency, that the 
Fed doesn't backslide.
  With respect to the dual mandate, the truth is the Fed has many 
mandates and they all ought to be examined. The Fed has been around for 
100 years. It is time to poke under the hood. That is why we are having 
the Centennial Monetary Commission, and I think it is important that we 
take a

[[Page 18471]]

good look to see if, at times, these are working at cross purposes.
  So I thank the gentleman from Iowa for his leadership. I urge all 
Members to adopt his amendment.
  Mr. KING of Iowa. Mr. Chairman, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment, as modified, 
offered by the gentleman from Iowa (Mr. King).
  The amendment, as modified, was agreed to.
  The Acting CHAIR. There being no further amendments, under the rule, 
the Committee rises.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Walker) having assumed the chair, Mr. Jody B. Hice of Georgia, Acting 
Chair of the Committee of the Whole House on the state of the Union, 
reported that that Committee, having had under consideration the bill 
(H.R. 3189) to amend the Federal Reserve Act to establish requirements 
for policy rules and blackout periods of the Federal Open Market 
Committee, to establish requirements for certain activities of the 
Board of Governors of the Federal Reserve System, and to amend title 
31, United States Code, to reform the manner in which the Board of 
Governors of the Federal Reserve System is audited, and for other 
purposes, and, pursuant to House Resolution 529, he reported the bill 
back to the House with sundry further amendments adopted in the 
Committee of the Whole.
  The SPEAKER pro tempore. Under the rule, the previous question is 
ordered.
  Is a separate vote demanded on any further amendment reported from 
the Committee of the Whole? If not, the Chair will put them en gros.
  The amendments were agreed to.
  The SPEAKER pro tempore. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. Pursuant to clause 1(c) of rule XIX, further 
consideration of H.R. 3189 is postponed.

                          ____________________