Rick Manning: Dudley ‘Busted Myth’ of Federal Reserve’s ‘Political Neutrality’

The Associated Press
AP Photo/Manuel Balce Ceneta

Americans for Limited Government (ALG) President Rick Manning released a statement Tuesday, slamming former New York Federal Reserve President Bill Dudley’s call for the Fed to consider how their policies will impact the 2020 election.

Former New York Federal Reserve President Bill Dudley urged his former colleagues on Tuesday not to help President Donald Trump in his trade war against China. He even urged the central bank to consider how its monetary policy might impact the 2020 presidential election.

The former New York Federal Reserve bank president said that the Fed could and should try to influence the election against the sitting president. Mainstream economists often assert that the Federal Reserve has to stay independent from political influence.

Dudley said:

After all, Trump’s reelection arguably presents a threat to the U.S. and global economy, to the Fed’s independence and its ability to achieve its employment and inflation objectives. If the goal of monetary policy is to achieve the best long-term economic outcome, then Fed officials should consider how their decisions will affect the political outcome in 2020.

ALG President Manning said that Dudley’s call to influence the 2020 president through the Federal Reserve’s monetary policy busts the “myth” of the Federal Reserve’s “political neutrality.”
Manning said in a statement Tuesday:
The myth of the Federal Reserve’s political neutrality has been busted by former New York Federal Reserve President Bill Dudley’s non-plussed urging of the Fed to take 2020 political calculations into account when setting monetary policy in order to defeat President Trump in the election. Now that the illusion of a politically neutral Fed has been annihilated, President Trump’s recent focus on the failure of the central bank to take into account competitive devaluations by China and Europe to boost exports, and of exchange rates is vindicated.
Trump has attacked the Federal Reserve over its reluctance to ease interest rates in the wake of the country’s trade war with China. President Trump has recently questioned whether Federal Reserve President Jerome Powell or Chinese President Xi Jiping is the bigger enemy to the American economy.
Manning continued:
The audacity the non-elected central bank seeking to impact election outcomes and fiscal policies is only exceeded by the 2016 attempt of the nation’s intelligence agencies and Justice Department to stop the election of Trump and their subsequent efforts to unseat him.
“Federal Reserve Chairman Jerome Powell needs to denounce Dudley’s remarks immediately and forcefully if the central bank is to retain any shred of credibility,” Manning added.

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