Barney Frank, chairman of the House Financial Services Committee, said he’s “appalled” by Republicans who he said have sided with foreign central banks in criticizing Federal Reserve chairman Ben S. Bernanke.
“I was appalled to see a group of Republican economists from the Bush and Reagan administration” arguing against the Fed’s asset-purchase program. “Republicans are joining the central bank of China in attacking Bernanke. This is really distressing to me.”
Frank, who spoke in an interview today on Bloomberg Television’s “In Business with Margaret Brennan,” called the Fed program to purchase $600 billion in assets through June “a very reasonable thing” that isn’t fueling inflation, as Republican critics contend.
A group of 23 people including former Republican government officials and economists published a letter to Bernanke urging him to halt the expansion of monetary stimulus because it risks an inflation surge. Separately, John Boehner, nominated to be the next House speaker, and three other Republicans leaders last week sent Bernanke a letter expressing “deep concerns” about a policy they said risked weakening the dollar and fueling asset bubbles.
“I wish we had some more fiscal stimulus,” Frank, a Massachusetts Democrat, said. “In the absence of that, given unemployment, given the complete absence of inflation, he is doing a very reasonable thing.”
The Fed on Nov. 3 said it was expanding record stimulus to try to reduce 9.6 percent unemployment and keep the inflation rate from dropping further. China, Brazil, South Africa and Germany have said the injection of cash into the system may weaken the U.S. dollar.
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