Last week (July 7) I wrote on this blog about a newly-introduced bill that would require policy rules for the Fed. Since then a Congressional hearing was held on the bill on July 10, Fed Chair Janet Yellen was cross-examined about it in two more Congressional hearings on July 15 and 16, and the proposal has been widely-covered in the press, social media, blogs, and opeds. And all this occurred just 6 weeks following the Centennial conference we had out here on policy rules for the Fed. What a rollout!
Here is the first main section (Section 2) of the legislation, HR 5018, which has attracted so much coverage. Section 2 is only 10 pages, and much of that is a list of definitions. So you do not have to wait until it is passed to read it.
Here is some of the reporting on the July 10 hearing: House Republicans Restart Their War on the Fed, Republicans Want Fed to Report to Congress on Monetary Policy, House GOP Bill Turns to Bush Economist to Rein in Fed, Congress Eyes Rules for the Fed. Here is my written testimony at that hearing and the complete video of the hearing.
Here is an informative blog post submitted by David Papell and his colleagues on Econbrowser explaining why the bill’s authors chose the Taylor Rule to be the Reference Rule
Here is my Wall Street Journal article from yesterday.
There is much more that you can uncover with search engines, but overall I think the debate has been informative, including that during the semi-annual hearings with Janet Yellen and subsequent press reporting . As I read the legislation, I have to say that I completely disagree with Janet Yellen that it would be “grave mistake” for Congress to pass it or that it “would essentially undermine central bank independence.” I have to agree with the Members of Congress who characterized this as an alarmist response as reported in the New York Times by Binyamin Applebaum.