Tags: Coronavirus | federal reserve | recovery bill | stimulus meeting

Recovery Bill Exempts Fed From Much of Open Meetings Law

federal reserve chair jerome powell
Federal Reserve Chairman Jerome Powell (Manuel Balce Ceneta/AP)

By    |   Thursday, 09 April 2020 12:02 PM

The recovery bill passed by Congress includes a provision that allows the Federal Reserve to organize a $450 billion bailout fund without having to adhere to much of the federal open meetings law, Politico reports.

This provision allows the Fed to hold meetings without the board giving a day’s notice beforehand. The central bank also would be exempted from keeping minutes at closed-door meetings, which could drastically reduce the amount of information the public receives about how the loan program was planned, including what could have influence the board’s decisions.

“We may never know what terms are being given to banks, what collateral is being offered, what repayment methods and duties banks and other financial institutions may have,” said media attorney Charles Glasser, who represented Bloomberg News in a lawsuit over public records involving the Fed after the 2008 financial crisis. “And these are important questions.”

Glasser added, “This is written too broadly and allows the Federal Reserve to avoid its responsibilities of public disclosure as the courts have described them.”

Donald Kohn, the former vice chairman of the Fed from 2006 to 2010, told Politico that the board was “handicapped” during the financial crisis because of the open-meetings law, which meant that members would sometimes have to leave the room to keep groups from growing too large.

“We were handicapped going through the 2007-09 crisis because we couldn’t have more than three members of the board in the room at one time without announcing a meeting,” Kohn said. “A crisis evolves rapidly and in unexpected ways, with the need for freewheeling discussion before a proposal is brought to the board for decision.”

He added, “This will allow Chair [Jerome] Powell to utilize his board members more fully and effectively.”

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Politics
The recovery bill passed by Congress includes a provision that allows the Federal Reserve to organize a $450 billion bailout fund without having to adhere to much of the federal open meetings law, Politico reports.
federal reserve, recovery bill, stimulus meeting
290
2020-02-09
Thursday, 09 April 2020 12:02 PM
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