May 1, 2008

Ryan rips Fed for cutting interest rates again

U.S. Rep. Paul Ryan got his Alan Greenspan on today with a fiery press release criticizing the Fed's latest interest rate cut. Ryan wants to pass a law that would force the Fed to focus on inflation and price stability, as opposed to economic growth. He blames the low interest rates for rising food and gas prices.

Here's the release:

Ryan on Rate Cuts: Enough is Enough

WASHINGTON – On the heels of yet another interest rate cut, Wisconsin’s First District Congressman Paul Ryan today announced plans to introduce legislation that would recommit the Federal Reserve to controlling inflation. Since last September, the Fed has slashed the federal funds rate down to 2%. Congressman Ryan has been outspoken with his concerns on inflation, as interest rate cuts have persisted in the face of rising prices.

While dealt a bad hand, the Fed has been unsuccessful in balancing their dual – and often contradictory – mandate of both short-term economic growth and long-term economic stability. Congressman Ryan has sought to set our monetary policy back on sound economic footing with the introduction of The Price Stability Act of 2008. This legislation would give the Federal Reserve a single mandate: price stability. The Price Stability Act would not alter the tools at the Fed’s disposal, but rather direct the Fed to make their overriding policy goal that of controlling inflation.

As the negative impact of our monetary policy becomes increasingly clear to Americans, Congressman Ryan has issued the following statement:
"Enough is enough. The continued rate cuts from the Federal Reserve have fueled price increases across the board. Inflation is an insidious threat to our economic well-being: it wipes away savings; it eats away at the paychecks of working people; and it devalues the quality of life of those living on fixed incomes.

"Congress bears some of the responsibility for the Fed’s recent actions. The Congressional mandate given to the Fed must be reexamined. The Price Stability Act would refocus our monetary policy to tackling inflation. Our economic challenges require bold solutions – and this commitment to sound money is a vital component to strengthening our economy."

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