House GOP Calls for Turning Macroeconomic Policy Over to a Cabal of Unelected Bankers

Every time Romney opens his mouth he seems to drive even more of those less well-educated, populist, culturally conservative Republicans into Santorum camp.  How can the GOP win those voters back in the fall?  The House Republicans have concocted a brilliant idea:

The bill, which will be formally introduced later this week by Congressman Brady, would eliminate the employment leg of the dual mandate, requiring the Federal Reserve to focus only on price stability.

The legislation would also restructure the Federal Open Market Committee (FOMC). The bill would give permanent seats on the committee to the twelve regional Federal Reserve bank presidents, who are chosen by regional Federal Reserve Bank directors. Those boards are composed of private citizens.

Voila; you’ve pissed off unemployed Youngstown steelworkers and Ron Paul audit the Fed nuts in one grand gesture.  But at least it would lock up the conservative, hard money, small town banker vote for the GOP.

PS.  I found this amusing:

Sensing a political opportunity, all twenty-seven Democrats on the panel have signed a letter asking the chairman, Representative Spencer Bachus, to hold a full hearing on the matter of keeping the Federal Reserve from addressing unemployment. They stress they do not support the bill, but coyly say that “the country would benefit from having a full discussion of this issue, now that it has been raised by various influential figures, including you.”

Say what you will about the Dems, they aren’t suicidal.

PPS.  I don’t have a link for the first quotation—it seems to be a memo from the House Committee on Financial Services.

HT:  Christopher Mahoney

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About Scott Sumner 492 Articles

Affiliation: Bentley University

Scott Sumner has taught economics at Bentley University for the past 27 years.

He earned a BA in economics at Wisconsin and a PhD at University of Chicago.

Professor Sumner's current research topics include monetary policy targets and the Great Depression. His areas of interest are macroeconomics, monetary theory and policy, and history of economic thought.

Professor Sumner has published articles in the Journal of Political Economy, the Journal of Money, Credit and Banking, and the Bulletin of Economic Research.

Visit: TheMoneyIllusion

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