The Federal Reserve’s Rule-Making Secrecy

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The Wall Street Journal has a thoroughly reported story today on the rise in regulatory secrecy at the Federal Reserve. On 45 of 47 of the draft or final regulatory measures voted on by members since the passage of the Dodd-Frank financial reform bill in July 2010, the Fed’s five voting members have e-mailed their votes in, rather than holding the votes in public meetings. The lack of public meetings is a change from the past: In the 1980s and 1990s public voting on regulatory issues were more frequent.

The Fed has been making an effort to appear more open in other decision making areas recently, holding regular press conferences and increasing the information it releases about its monetary policy decisions.

But this new show of transparency hasn’t extended to regulation. The Fed is currently working on 250 rule-writing projects, the Journal reports. Daniel Tarullo, a Fed governor appointed by President Barack Obama and in charge of the rule-writing effort, told the Journal open meetings aren’t always good. “You can have a scripted meeting that does not show any engagement at all,” he said.

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