Title V — Exchange Rate Responsibility Act

S. 238 · 113th Congress · Feb 7, 2013 · Lineage

V Exchange Rate Responsibility Act

Sec. 501 Findings

The Congress finds as follows:

(1)

The Board of Governors of the Federal Reserve System and the Federal Open Market Committee exercise control over the supply of U.S. dollars, which is a major factor affecting the foreign exchange rate value of the United States dollar. Therefore, the Board of Governors and Federal Open Market Committee should report to Congress on the impact of monetary policy on the foreign exchange rate value of the United States dollar.

(2)

Over the last several decades, Secretaries of the Treasury have repeatedly used the Exchange Stabilization Fund for purposes that were not envisioned by Congress. To prevent further abuses, the Exchange Stabilization Fund should be renamed as the Special Drawing Rights Fund. The Special Drawing Rights Fund should hold the Special Drawing Rights that the International Monetary Fund provided to the United States. Any other assets currently in the Exchange Stabilization Fund should be liquidated, and the proceeds used to reduce the public debt.

Sec. 502 Report on the effect of exchange rate policy

Section 2B(b) of the Federal Reserve Act, as amended by section 102(b), is further amended by adding at the end the following:

“(5) an analysis of how the policies of the Board and the Federal Open Market Committee are affecting the foreign exchange rate value of the United States dollar.”

Sec. 503 Renaming of Exchange Stabilization Fund

(a)

In general— Section 5302 of title 31, United States Code, is amended by striking “stabilization fund” each place such term appears and inserting “Special Drawing Rights Fund”.

(b)

Conforming amendments—

(1)

Balanced Budget and Emergency Deficit Control Act of 1985— Section 255(g)(1)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 905(g)(1)(A)) is amended by striking “Exchange Stabilization Fund” and inserting “Special Drawing Rights Fund”.

(2)

Emergency Economic Stabilization Act of 2008— The Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5211 et seq.) is amended—

(A)

in section 131, by striking “Exchange Stabilization Fund” each place such term appears in headings and text and inserting “Special Drawing Rights Fund”; and

(B)

in the item relating to section 131 in the table of contents of such Act, by striking “Exchange Stabilization Fund” and inserting “Special Drawing Rights Fund”.

(3)

International Financial Institutions Act— Section 1704 of the International Financial Institutions Act (22 U.S.C. 262r–3) is amended by striking “stabilization fund” each place such term appears and inserting “Special Drawing Rights Fund”.

(4)

Special Drawing Rights Act— The Special Drawing Rights Act (22 U.S.C. 286n et seq.) is amended by striking “Exchange Stabilization Fund” each place such term appears and inserting “Special Drawing Rights Fund”.

(c)

References— Any reference in a law, regulation, document, paper, or other record of the United States to the “Exchange Stabilization Fund” shall be deemed a reference to the “Special Drawing Rights Fund”.

Sec. 504 Conversion to all-SDR Fund

(a)

Funds used To reduce the debt— The Secretary of the Treasury shall liquidate all property in the Special Drawing Rights Fund (as so renamed under section 503), other than Special Drawing Rights, and use all such amounts to reduce the public debt.

(b)

Limitation on Fund— Section 5302 of title 31, United States Code, is amended—

(1)

in subsection (a)(1)—

(A)

by striking “is available to carry out” and inserting “is only available to carry out”; and

(B)

by striking “, and for investing in obligations of the United States Government those amounts in the fund the Secretary of the Treasury, with the approval of the President, decides are not required at the time to carry out this section. Proceeds of sales and investments, earnings, and interest shall be paid into the fund and are available to carry out this section. However, the fund is not available to pay administrative expenses”; and

(2)

by striking subsection (b) and inserting the following:

“(b) Fund only To hold Special Drawing Rights—Notwithstanding any other provision of law, only Special Drawing Rights may be deposited into the Special Drawing Rights Fund.”

(c)

Conforming amendments—

(1)

Bretton Woods Agreements Act— Section 18 of the Bretton Woods Agreements Act (22 U.S.C. 286e–3) is hereby repealed.

(2)

Support for East European Democracy (SEED) Act of 1989— The Support for East European Democracy (SEED) Act of 1989 (22 U.S.C. 5401 et seq.) is amended—

(A)

in section 101(b)(1), by striking “such as—” and all that follows through the end of the paragraph and inserting “such as the authority provided in section 102(c) of this Act.”; and

(B)

in section 102(a), by striking “section 101(b)—” and all that follows through the end of the subsection and inserting “section 101(b), should work closely with the European Community and international financial institutions to determine the extent of emergency assistance required by Poland for the fourth quarter of 1989.”.

(d)

Treatment of certain funds— Funds that would otherwise have been deposited into the Special Drawing Rights Fund (as so renamed under subsection (a)), but for the amendments made by this section, shall instead be paid to the Secretary of the Treasury, and the Secretary of the Treasury shall use such funds to reduce the public debt.

(e)

Wind down period for certain transactions— Notwithstanding any other provision of this section, during the 3-year period beginning on the date of the enactment of this Act, property other than Special Drawing Rights may be deposited, and maintained, in the Special Drawing Rights Fund as needed to fulfill any outstanding obligations on the Fund.