The Dodd-Frank Wall Street Reform and Consumer Protection Act is coming up on its fifth birthday next month. Seldom has a law’s meaning been so little determined five years out from passage—especially a law running hundreds of pages. Dodd-Frank seems to frustrate everyone: Wall Street finds it massively burdensome and parts of it profoundly wrong-headed; and reformers see it as insufficiently ambitious, especially in curbing the big banks’ influence. As a result, there will be few festivities to celebrate Dodd-Frank’s birthday; instead we will get a bumper crop of critical think pieces about the state of financial regulation and a fair number of proposed substantial amendments as well. Many aspects of the law seem to be still up for grabs: the jurisdiction and decision-making processes of the Financial Stability Oversight Council, the scope of the powers of the Consumer Financial Protection Bureau, and whether the Volcker rule will ever be written so as to matter.

At the same time there is still a great deal of energy to enact new legislation that would incorporate rather different lessons from those inspiring Dodd-Frank—mostly from legislators who take a fairly dim view of the Fed’s crisis actions. Here is a pretty good summary from a few months back: there is the “Audit the Fed” crowd and the Federal Reserve Accountability and Transparency (FRAT) Act(which would require the Fed to set its own monetary policy rule and then explain any deviation to Congress immediately). There are also attempts to change the place of the New York Fed in the system or even to eliminate the roles of all of the regional Feds on the FOMC (see Peter’s paperpresented at Brookings in March) and attempts to constrain the Fed’s available lending powers.

I am genuinely puzzled about the composition of these currently active reforms. Audit the Fed—which, to be fair, seems to have lost some steam by now—seems quite confused, in that the Fed is already audited regularly and having the GAO examine the Fed’s monetary policy decision-making seems unlikely to provide any really great benefits. The FRAT Act’s backers said it would help prevent the kind of low-too-long rate environment of the mid-2000s that they believed help cause the crisis, but the Fed is vehemently opposed to being ordered to tie its own hands in such a way as to make itself directly accountable to Congress, and it fairly points out that it has been fairly transparent about its current monetary policy regime’s objectives of two percent inflation and 5ish percent unemployment. Peter’s case for structural reform of the role of the regional Feds is fascinating, but I have to admit that it’s not very clear to me what issue exposed by the crisis it would solve. Given the FRBNY’s huge importance, it probably makes sense to have that official appointed by the President and confirmed by Congress, but it’s unclear whether that would have made any difference to the Fed’s recent crisis choices, as the FRBNY’s President always worked hand-in-glove with the Chairman of the Board of Governors.

Finally, there are attempts to constrain the Fed’s lending powers, which do seem more to the point for critics of the Fed who were distressed by its massive loans during the crisis. But the forms they take seem curiously blind to the ways in which the Fed’s lending was actually legally problematic.

Dodd-Frank itself took some steps on this front. Title XI of the law (which did require a one-time GAO audit of all the Fed’s crisis actions, which was completed in 2011) made it impossible, for better or worse, for the Fed to engineer firm-specific rescues such as those embodied in its Maiden Lanes. It also gave the Treasury Secretary the power to veto the creation of new emergency Fed facilities—a move I tentatively support in To the Edge, since I believe having the backing of the electorally-accountable branch is crucial to the Fed’s ability to achieve legitimacy. When special lending facilities are created, Congress will be informed of their activities much faster and more fully.

Dodd-Frank left many central questions unanswered, though. Some pertain to the central lender of last resort function that Peter and I debated in our Lehman posts: should there be explicitly defined statutory requirements for emergency Fed lending? The Warren-Vitter bill, formally titled the Bailout Prevention Act of 2015, currently sitting in the congressional hopper answers this with a resounding yes: it would force immediate public Fed certification of the borrower institution’s solvency, with analyses also made immediately public, and then it would require an interest rate of at least five percentage points above the Treasury rate. Ben Bernanke recently explained why he thinks this would effectively end the Fed’s role as lender of last resort: the requirement of immediate disclosure would create a stigma problem that would undermine the Fed’s ability to stabilize an institution, since the stigma of seeking such a badly priced loan would cause (or exacerbate) a run on that institution. That concern seems sensible to me, but it neatly sidesteps the question of whether a requirement of delayedpublic justification would be a sensible way to improve the Fed’s legitimacy. As of now, the Fed’s thinking has been a closed book, but it’s not clear what function that serves at this remove.

What’s frustrating to me is that none of these actively debated reforms gets to what I see as a central question: should the Fed be able to create programs in which it charges fees rather than making loans against fully satisfactory collateral, as it did with the Commercial Paper Funding Facility (CPFF)? The CPFF was a broad-based and very successful program, but it was still quite legally dicey because of the way it was structured. As Perry Mehrling beautifully describes in The New Lombard Street, 2008 was a watershed moment for central bankers as they became market-makers of last resort, and the statutes governing the Fed have not been updated to cope with this change to this point. And nobody in the legislature seems terribly concerned by this; apparently, legally awkward improvisation was good enough last time around to be the favored solution next time, too.

There is a real opportunity here to channel some of the still-vibrant reform energy to targeted reforms that would make the Fed better prepared to meet the next crisis in a legitimate way. Grabbing that opportunity requires being able to see the Fed’s legal limitations as contributing to its legitimacy problems and believing the Fed needs to be rehabilitated to be ready to act as lender of last resort in the next crisis, may it be long from now. Fed critics’ anti-Fed zeal, their sense that if the Fed did things wrong it deserves to be punished rather than empowered, makes them reluctant to embrace the latter belief. The Fed’s own desire to pretend that everything it did in 2008 and 2009 was just ho-hum business as usual makes it reluctant to understand or explain the former point. But a more legally dexterous and accountable Fed would also be a more legitimate Fed, and that is something we should be willing to work for.