When the Republicans assume control of the House of Representatives in January, the best show in town, and possibly one of the most important policy debates in decades, begins when Rep. Ron Paul (R-Texas) takes the gavel of oversight of the Federal Reserve Board.
Paul will be chairman of the Domestic Monetary Policy subcommittee of the House Financial Services Committee, which will give him a prime oversight role over Fed policies and practices.
The implications could be profound when the chairman of the Federal Reserve meets the chairman of his oversight committee, who has stated that the use of subpoenas will not be ruled out, if needed.
My views are well-known to readers of my column. I have been critical of a number of Federal Reserve Board policies and procedures under the chairmanships of both Alan Greenspan and Ben Bernanke.
I would suggest today that because of the inability of Congress and the president to agree on substantial economic revival policies, Chairman Bernanke and the Fed have assumed by necessity a larger role than I would like over economic recovery. Some of these policies I agree with, others I do not.
Ron Paul has long criticized many of the practices of the Fed, especially those that involve great secrecy with little or no public disclosure, and in this I am sympathetic to him.
Even with the limited disclosure required by the new financial-services law, we have learned about a range of companies that received help from the Fed that were not known at the time, but should have been disclosed much sooner.
We also learned something about the degree of assistance that helped foreign firms, which was not known at the time, and should have been disclosed much sooner.
My hope and expectation is that Paul will be bipartisan and careful in his oversight and investigations. If he is, oversight of the Fed could be a surprise area of bipartisanship. Many Democrats have concerns similar to Paul's.
The Paul chairmanship could become a powerful and profound check and balance on Fed policy, if the new chairman proceeds carefully to address questions that should have been addressed long ago.
How far should the Fed move in secret and act without disclosure? Serious analysts know that some secrecy is needed, but how much secrecy is too much?
What are the proper conditions, if any, when bailed-out banks refuse to lend after receiving the bailouts at taxpayer expense?
What limits should be applied, if any, to firms receiving taxpayer bailouts that pay their management lucrative bonuses?
Some of these concerns, and others, have been raised by prominent conservatives, liberals, Tea Party supporters and progressive reformers. All deserve responsible attention.
Again, I hope and believe that Paul will raise major issues in a careful, bipartisan and responsible manner.
We live at a fragile time for the American and world economies. These questions and inquiries should be managed with prudence and diligence.
I hope the incoming chairman uses the power of subpoena in limited ways with broad bipartisan support.
When Mr. Chairman (of the Federal Reserve Board) meets Mr. Chairman (of the oversight subcommittee) it will be a powerful and riveting moment beginning a serious national dialogue.