From House floor, Rep. Frank rips George Will for ‘intellectual dishonesty’

House Financial Services Committee ranking member Barney Frank (D-Mass.) spent nearly 30 minutes on the House floor Friday ripping apart a column by George Will, in which Will criticized Frank for denouncing how U.S. monetary policy is made.

“His response in his column, and in a follow-up column, basically seemed to be a sad combination of blatant factual inaccuracy, of logical confusion, and sadly, I must say, of intellectual dishonesty, and finally great inconsistency,” Frank said.

Frank explained that he is opposed to the current system in which the Federal Reserve Board of Governors establishes monetary policy, which is done by allowing five regional Federal Reserve bank presidents vote on its decisions. 

Frank said he supports the right of these regional presidents to discuss monetary policy in the Fed’s meetings but said they should not be allowed to vote because they are not democratically elected.

{mosads}”Having people who are appointed by bankers … be five of the 12 votes in setting monetary policy I believe violates democratic norms,” Frank said. 

He added that he believes this system creates a bias against having the Fed worry equally about inflation and unemployment, the Fed’s so-called dual mandate, saying their influence creates a tendency to worry more about inflation.

Frank said Will missed several aspects of his argument in a Sept. 29 column called “A Frank ‘Cure’ for the Fed.” Will’s column said that while Frank says he has “long been troubled” by the nonelection of federal monetary policymakers, he only proposed legislation to change this system after a 7-3 Federal Open Market Committee (FOMC) vote that supported continuing low interest rates.

Frank acknowledged that he did not like the three opposing votes and again commented on the “undemocratic element” of U.S. monetary policy, but said Will missed that Frank’s bill was actually introduced in April, not August. Frank said Will seemed to be presuming that Frank had other motives for introducing his bill, and used complaints about the lack of a democratic process for choosing members of the FOMC as a “cover” for his bill.

“But I did it in April, and he was flatly wrong,” Frank said, adding that Will’s “lofty philosophical position” seems to have prevented him from “doing any fact checking.”

Frank noted that Will later corrected this error of timing but seemed to diminish its importance by saying he “suggested” that the bill was introduced in August. Frank said Will dismissed a “central flaw in his argument” as if it were an “incidental error.”

Frank also criticized Will for asserting that many liberals are opposed to a free debate. Frank countered that he has consistently spoken out against things like campus speech codes and tougher penalties for hate speech.

“So Mr. Will is just again factually inaccurate in accusing me of being one of those people who is for stopping dissent,” he said.

Further, he said Will confused freedom of speech with the right to make U.S. monetary policy. 

“I did not say that federal regional presidents shouldn’t be allowed to talk about Federal Reserve monetary policy or anything else,” Frank said. “The bill says that they shouldn’t be given a vote on public policy. I am frankly very surprised … that Mr. Will confuses the two.”

Frank said he believes Will would support a single Fed mandate to worry only about inflation, not employment and said he would be willing to debate that point.

He also had words for Dallas Federal Reserve Board Chairman Richard Fisher, who said recently that the Federal Reserve system is under attack not only from Frank, but from conservative members of Congress like Rep. Ron Paul (R-Texas). Fisher said that he doesn’t see any difference between Frank and Paul, even though Frank said there are many differences between himself and Paul on economic issues.

“If this man really can’t see any difference between the positions of myself and Ron Paul on economic matters, then he’s hardly competent to be doing anything, much less voting on Open Market Committee policy,” Frank said.