Dear Monetary Policy Observer,
The below article is a story. Of a Rep named Brady, who's proposing a lovely little bill (sorry, just had to get in a Brady Bunch joke). In all seriousness, though, this is last week's Forbes column from Ralph about the new "Sound Dollar Act", what's in it, and who doesn't want to see it passed. Not quite as funny as a TV sitcom, but almost as much drama between the various political factions.
American Principles In Action
Good Money: Why Rep. Kevin Brady's Sound Dollar Act Worries Barney Frank
By Ralph Benko
Why is Rep. Barney Frank rounding up his liberal legislative militia to oppose the Sound Dollar Act of 2012? This is a bill recently introduced by Rep. Kevin Brady, top Republican on the Congressional Joint Economic Committee. It is co-sponsored by 31 of his House colleagues and has a Senate counterpart from Utah’s Mike Lee.
A panicked Rep. Frank snapped to immediately. He rounded up 26 liberal democrats to sign a letter of opposition. “We believe strongly that the dual mandate should be maintained, and we believe that the Federal Reserve’s actions in pursuit of that mandate have been helpful in dealing with our unemployment problem,” wrote Frank and fellow liberals to committee chairman Spencer Bachus.
Believe it or not, Frank’s beliefs do not always coincide with common sense reality. As Boston Globe columnist Jeff Jacoby wrote in 2008:
“Time and time again, Frank insisted that Fannie Mae and Freddie Mac were in good shape. Five years ago, for example, when the Bush administration proposed much tighter regulation of the two companies, Frank was adamant that “these two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis.” When the White House warned of “systemic risk for our financial system” unless the mortgage giants were curbed, Frank complained that the administration was more concerned about financial safety than about housing.
“Now that the bubble has burst and the “systemic risk” is apparent to all, Frank blithely declares: ‘The private sector got us into this mess.” Well, give the congressman points for gall.