The Federal Reserve is ultimately accountable to the public and Congress, but its independence has long been viewed as a necessary condition for sound monetary policy. Supposedly, this independence ensures monetary policy focuses on achieving long-run economic goals apart from short-term political pressures to do otherwise. A recent Washington Post editorial noted that “the very hallmark of central-bank independence, without which there is no point in having a central bank, is the occasional willingness to resist popular pressure, even to tell the majority of Americans ‘no.’” But just how independent has our central bank been? Is the Fed more independent now than it was at its founding in 1913? Can a central bank’s policy decisions be truly isolated from politics?
More About the Speakers
Assistant Professor of Legal Studies and Business Ethics, The Wharton School,
University of Pennsylvania, and author of The Power and Independence of the Federal Reserve
J. Lawrence Broz
Professor of Political Science, University of California, San Diego,
and author of International Origins of the Federal Reserve System
Mark A. Calabria
Director of Financial Regulation Studies, Cato Institute
Norbert J. Michel, Ph.D.
Research Fellow in Financial Regulations