The Washington establishment suffers a serious defeat

Glenn Greenwald - Something quite amazing happened yesterday in Congress: the House Finance Committee -- in a truly bipartisan and even trans-ideological vote -- defied the banking industry, the Federal Reserve, the Democratic leadership, and mainstream Beltway opinion in order to pass an amendment, sponsored by GOP Rep. Ron Paul and Democratic Rep. Alan Grayson, mandating a genuine and probing audit of the Fed. The Huffington Post's Ryan Grim has the best account of what took place, noting:

In an unprecedented defeat for the Federal Reserve, an amendment to audit the multi-trillion dollar institution was approved by the House Finance Committee with an overwhelming and bipartisan 43-26 vote on Thursday afternoon despite harried last-minute lobbying from top Fed officials and the surprise opposition of Chairman Barney Frank (D-Mass.), who had previously been a supporter.

Grim details how key Committee Democrats such as Frank -- who spent the year claiming to support an audit of the Fed in the face of rising anger over its secret and bank-subservient policies -- suddenly introduced their own amendment (sponsored by Democratic Rep. Melvin Watt) that would have essentially gutted the Paul/Grayson provisions. Read more.