TITLE II–ENTRY OF UNITED STATES MONEY INTO CIRCULATION
SEC. 201. ENTRY OF UNITED STATES MONEY INTO CIRCULATION.
The Secretary shall cause United States Money to enter into circulation by and through any of the following means:
(1) Any origination or disbursement of funds to accomplish Federal expenditures authorized and appropriated by an Act of the Congress.
(2) Any disbursement to retire outstanding instruments of indebtedness of the Federal Government or the Secretary of the Treasury as such instruments become due.
(3) Any contribution authorized by an Act of the Congress subject to any limitation established by the Monetary Authority to the Revolving Fund established in section 302 of this Act.
(4) Any action provided for in the transitional arrangements specified in title IV of this Act, including the conversion of all deposits in transaction accounts into United States Money.
(5) Any exercise of ‘lender of last resort’ emergency authorities under the emergency procedures specified in section 305.
(6) Any purchase of stock in a Federal reserve bank from a member bank and of any other assets as prescribed under the Federal Reserve Act as required to accomplish the purposes of section 301.
(7) Any other means, and for any other purpose explicitly authorized by an Act of the Congress that becomes law after the effective date of this Act.
TITLE III–RECONSTRUCTION OF THE FEDERAL RESERVE SYSTEM
SEC. 301. RECONSTITUTION OF THE FEDERAL RESERVE.
(a) Government Acquisition of All Net Assets of Federal Reserve System- On the effective date, the Secretary shall purchase on behalf of the United States all net assets in the Federal Reserve System, including the Federal reserve banks, according to the rules specified in the Federal Reserve Act (12 U.S.C. 288) for this purpose.
(b) Repayment of Reserves- Any reserves of any member bank that is held by any Federal reserve bank shall be returned to the member bank in the form of United States Money, subject to the provisions contained in sections 401 and 402(b).
SEC. 302. ESTABLISHMENT OF THE UNITED STATES MONETARY AUTHORITY.
(a) Monetary Authority-
(A) IN GENERAL- There is hereby established the Monetary Authority as an authority within the Department of the Treasury under the general oversight of the Secretary of the Treasury.
(B) AUTONOMY OF MONETARY AUTHORITY- The Secretary of the Treasury may not intervene in any matter or proceeding before the Monetary Authority, unless otherwise specifically provided by law.
(C) INDEPENDENCE OF MONETARY AUTHORITY- The Secretary of the Treasury may not delay, prevent, or intervene in the issuance of any regulation or other determination of the Monetary Authority, including the determination of the amounts of money to be originated and most efficient method of disbursement consistent with the appropriations of Congress and the statutory objectives of monetary policy as specified in this Act.
(A) IN GENERAL- The Monetary Authority shall consist of 9 public members appointed by the president, by and with the advice and consent of the Senate.
(i) IN GENERAL- Except as provided in subparagraph (E), each member of the Monetary Authority shall be appointed to a term of 6 years.
(ii) CONTINUATION OF SERVICE- Each member of the Monetary Authority may continue to serve after the expiration of the term of office to which such member was appointed until a successor has been appointed and qualified.
(C) POLITICAL AFFILIATION- Not more than 4 of the members of the Monetary Authority may be members of the same political party.
(i) IN GENERAL- Any vacancy on the Monetary Authority shall be filled in the manner in which the original appointment was made.
(ii) INTERIM APPOINTMENTS- Any member appointed to fill a vacancy occurring before the expiration of the term for which such member’s predecessor was appointed shall be appointed only for the remainder of such term.
(E) STAGGERED TERMS- Of the members first appointed to the Monetary Authority after the enactment of this Act–
(i) 1 shall be appointed for a term of 2 years;
(ii) 2 shall be appointed for a term of 3 years;
(iii) 2 shall be appointed for a term of 4 years;
(iv) 2 shall be appointed for a term of 5 years; and
(v) 2 shall be appointed for the full term of 6 years.
(3) CHAIRPERSON- One of the members of the Monetary Authority shall be designated by the President as the Chairperson of the Monetary Authority.
(4) DUTIES- The Monetary Authority shall–
(A) establish monetary supply policy and monitor the Nation’s monetary status; and
(B) carry out such other responsibilities as the President may delegate to the Monetary Authority or that may be provided by an Act of Congress.
(5) GOVERNING PRINCIPLE OF MONETARY POLICY- The Monetary Authority shall pursue a monetary policy based on the governing principle that the supply of money in circulation should not become inflationary nor deflationary in and of itself, but will be sufficient to allow goods and services to move freely in trade in a balanced manner. The Monetary Authority shall maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.
(6) MEETINGS- The Monetary Authority shall meet on a regular basis subject to the call of the Chairperson, the Secretary, or a majority of the members.
(7) PAY- The members of the Monetary Authority shall receive a salary at annual rates equal to the annual rate determined under section 5 of title 28, United States Code, for an associate justice.
(8) STAFF- The Monetary Authority may appoint and establish the pay of such employees as the Monetary Authority determines is appropriate to assist the Monetary Authority to carry out the duties imposed under this section.
(b) Responsibility of Secretary- The Secretary shall regulate the monetary supply in reasonable accordance with targets established by the Monetary Authority.
(c) Reports on Discrepancies- The Secretary shall report to the Congress any discrepancy between any monetary target and the monetary supply in excess of 0.5 percent at the end of each quarter.
SEC. 303. ESTABLISHMENT OF THE BUREAU OF THE FEDERAL RESERVE.
(a) In General- Subchapter I of chapter 3 of title 31, United States Code, is amended by adding at the end the following new section:
SEC. 314. BUREAU OF THE FEDERAL RESERVE.
‘(a) Establishment- There is hereby established the Bureau of the Federal Reserve as a bureau within the Department of the Treasury (hereafter in this section referred to as the ‘Bureau’).
‘(1) COMMISSIONER- The management of the Bureau shall be vested in a Commissioner who, with the assistance of the Deputy Commissioner and such staff as the Commissioner may appoint, shall carry out the duties vested in the Bureau and the Commissioner.
‘(2) DEPUTY COMMISSIONER- There is hereby established within the Bureau the position of Deputy Commissioner.
‘(3) APPOINTMENT- The Commissioner and the Deputy Commissioner shall be appointed by the president, by and with the advice and consent of the Senate.
‘(A) IN GENERAL- The Commissioner and the Deputy Commissioner shall each be appointed to a term of 7 years.
‘(B) STAGGERED TERMS- Notwithstanding subparagraph (A), the person first appointed Deputy Commissioner shall be appointed to a term of 4 years.
‘(A) IN GENERAL- Any vacancy on the Bureau shall be filled in the manner in which the original appointment was made.
‘(B) INTERIM APPOINTMENTS- Any member appointed to fill a vacancy occurring before the expiration of the term for which such member’s predecessor was appointed shall be appointed only for the remainder of such term.
‘(1) MONETARY POLICY- The Bureau shall–
‘(A) administer, under the direction of the Secretary, the origination and entry into circulation of United States Money, subject to the limitations established by the Monetary Authority; and
‘(B) administer lending of United States Money to authorized depository institutions, as described in section 403 (‘Revolving Fund’) to ensure that–
‘(i) money creation is solely a function of the United States Government; and
‘(ii) fractional reserve lending is ended.
‘(2) TRANSFERRED FUNCTIONS- After the effective date, the Bureau shall exercise all functions consistent with this Act which, before such date, were carried out under the direction of the Board of Governors of the Federal Reserve System.
‘(3) ITEMIZATION BY SECRETARY- Not less than 90 days before the effective date, the Secretary and the Monetary Authority shall itemize–
‘(A) the functions of the Board of Governors of the Federal Reserve System that are transferred to the Bureau pursuant to paragraph (2); and
‘(B) the provisions of the Federal Reserve Act and other provisions of Federal law, relating to the functions so transferred, in the application of which the term ‘Bureau’ (as established under this section) shall be substituted for the term ‘Board of Governors of the Federal Reserve System’ or ‘Board’, as the case may be.’.
(b) Clerical Amendment- The table of sections for subchapter I of chapter 3 of title 31, United States Code, is amended by adding at the end the following new item:
‘314. Bureau of the Federal Reserve.’.
(c) Role of Board After Enactment- With effect on the effective date, the Board of Governors of the Federal Reserve System shall be dissolved.
SEC. 304. FORECASTING OF DISBURSEMENT REQUIREMENTS.
The Secretary shall–
(1) forecast disbursement requirements on a daily, monthly, and annual basis;
(2) provide such forecasts to the Congress and the public;
(3) integrate forecasts with the Federal budget process;
(4) maintain a sufficient research capability to continuously and effectively assess the impact of disbursement of United States Money on all aspects of the domestic and international economies; and
(5) report to the Congress and the public regularly on the economic impact of disbursements of United States Money and the status of the monetary supply.
SEC. 305. LENDER OF LAST RESORT; EMERGENCY PROCEDURES.
(a) Recommendation of the President Upon Recommendation of Emergency Board- The Monetary Authority may not exercise any authority under the 3rd undesignated paragraph of section 13 of the Federal Reserve Act unless–
(1) the Emergency Board established under subsection (b) recommends, upon a vote of 2/3 of the members, to the House of Representatives and the Senate, that the House of Representatives and the Senate adopt a concurrent resolution calling on the President to certify that a national emergency exists which requires the exercise of such authority;
(2) the House of Representatives and the Senate each adopt, by a vote of 2/3 of the members present, a concurrent resolution calling on the President to certify that a national emergency exists which requires the exercise of such authority; and
(3) the President issues a certification that a national emergency exists which requires the exercise of such authority by the Monetary Authority.
(b) Emergency Board- There is established for purposes of this section the Emergency Board which shall consist of the following members:
(1) The President.
(2) The Secretary of Commerce.
(3) The Secretary of Energy.
(4) The Secretary of Labor.
(5) The Secretary of the Treasury.
(6) The Speaker of the House of Representatives.
(7) The minority leader of the House of Representatives.
(8) The majority leader of the Senate.
(9) The minority leader of the Senate.
(10) The chairpersons and ranking members of the Committee on Financial Services and the Committee on Oversight and Government Reform of the House of Representatives.
(11) The chairpersons and ranking members of the Committee on Banking, Housing, and Urban Affairs and the Committee on Homeland Security and Governmental Affairs of the Senate.
(c) Rule of Construction- Except as provided in subsection (a), no provision of this Act shall be construed as affecting the authority of the Monetary Authority under the 3rd undesignated paragraph of section 13 of the Federal Reserve Act.