US Fed Reserve head grilled about Board’s independence

By Kasim Ileri

WASHINGTON

Federal Reserve Board Chair Janet Yellen was accused Wednesday of leaning toward Democrat policies.

On her second day of semiannual congressional testimony on monetary policy and the U.S. economic outlook, House Republican lawmakers grilled Yellen on the independence and transparency of the Board.

During testimony Tuesday before the Senate, Yellen said the Fed should not be exposed to government audits because it would politicize monetary policy. She reiterated her standing before the House as well.

"I don't believe in chaining, that the Fed should chain itself to any mechanical rule," she said. 

Republican lawmakers, however, accused Yellen of being close to the Obama administration and Democrat lawmakers and suggested that most of her statements were somehow in line with Democrats’ legislative policies.

Rep. Bill Huizenga of Michigan told Yellen she had met with administration officials twice as many times as she had met with committee lawmakers, adding that he was not among the lawmakers she had met although he was the vice chair of the Committee on Financial Services.

"In fact, last year," he said, “from February through December alone, you held 51 meetings with the White House and 23 meetings with lawmakers,” accusing her of taking the position of the White House. 

Rep. Scott Garret of New Jersey also agreed with Huizenga. 

Referring to claims that auditing the Fed would politicize monetary policy, Garret said in practice the board is politicized under the influence of Democrats. 

"As far as who you're seeing in the Congress, it's a 2-to-1 ratio who you're lobbying hard with, of Democrats to Republicans. And your monetary decisions are being praised by the Democrats, being criticized by Republicans. It would seem you've already made monetary policy a partisan political exercise," he added.

He cited several remarks and decisions by Yellen and her predecessors that fit into Democrat policies and benefited Democrats ahead of elections. 

Yellen said the claim was "a complete mischaracterization," but declined to give the transcripts of her meetings with administration officials and Democrat lawmakers.