Federal Reserve Modernization Act of 2012

Bill: 112-s-2247
Sponsor: Sen. Lee, Mike [R-UT]
Introduced: 2012-03-28 in the Senate
Policy area: Economics and Public Finance
Subjects: Administrative law and regulatory procedures
Bank accounts, deposits, capital
Budget deficits and national debt
Congressional oversight
Consumer Financial Protection Bureau
Consumer affairs
Credit and credit markets
Economic performance and conditions
Executive agency funding and structure
Federal Reserve System
Government information and archives
Government trust funds
Inflation and prices
International monetary system and foreign exchange
Monetary policy
Securities
Unemployment

Summary:
action_date: 2012-03-28
text: 
 Federal Reserve Modernization Act of 2012 - Amends the Federal Reserve Act (FRA) to direct the Board of Governors of the Federal Reserve System (Board) and the Federal Open Market Committee (FOMC) to: (1) promote the goal of long-term price stability, and (2) establish metrics to evaluate whether long-term price stability is being achieved.
 
Prescribes procedures for the establishment and evaluation of such metrics.
 
Directs the Board and the FOMC to: (1) make such information available to the public on a website, and (2) report to Congress each time such metrics are set or revised.
 
Directs the Board to include in its semiannual report to Congress: (1) the results of the evaluation process, (2) whether the goal of long-term price stability is being met, (3) the main monetary policy instruments and strategy used by the Board and the FOMC to achieve long-term price stability, and (4) an analysis of how the policies of the Board and the FOMC are affecting the foreign exchange rate value of the U.S. dollar.
 
Directs the Board to clearly articulate its lender-of-last-resort policy.
 
Revamps FOMC membership to consist of one representative from each of the Federal Reserve banks (in addition to members of the Board).
 
Directs the FOMC to release meeting transcripts to the public within three years after each meeting.
 
Redesignates the Department of the Treasury stabilization fund as the Special Drawing Rights Fund. Instructs the Secretary of the Treasury to liquidate all property in the Fund (other than Special Drawing Rights) and to use all such amounts to reduce the public debt.
 
Limits the availability of the Fund solely to stabilize exchange rates and arrangements. Repeals the authority of the Secretary to deal in U.S. instruments of credit and securities. Permits only Special Drawing Rights to be deposited into the Fund. Requires funds that would otherwise have been deposited into the Fund to be paid, instead, to the Secretary to reduce the public debt.
 
Amends the FRA to authorize the FOMC, in unusual and exigent circumstances, by the affirmative vote of two-thirds of its members, to grant any Federal Reserve bank emergency authority to buy and sell U.S. debt obligations and revenue bonds in anticipation of the collection of taxes or the receipt of assured revenues by any state or local governmental entity, as well as obligations of, or guaranteed by, a foreign government or agency.
 
Amends the Consumer Financial Protection Act of 2010 to repeal: (1) funding for the Consumer Financial Protection Bureau (CFPB), and (2) the Bureau of Consumer Financial Protection Fund.


Legislative actions:
action_date: 2012-03-28
text: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
action_date: 2012-03-28
text: Introduced in Senate