Less than a year after Congress came too close to seriously impinging on the crucial monetary policy independence of the Federal Reserve, a much more reasonable idea about the Fed’s role is emanating from the national legislature.
Championed by a couple of conservative Republicans, the latest notion is to make the Fed more like other central banks. Like the European Central Bank, for instance.
The way to do that, according to Rep. Mike Spence, R-Ind., and Sen. Bob Corker, R-Tenn., is to halve the “dual mandate” the Fed has been trying to fulfill for the past 33 years. That dual mandate, put simply by Eric S. Rosengren, president of the Federal Reserve Bank of Boston, involves trying to achieve “the lowest possible unemployment rate consistent with price stability.”