By Peter Schroeder - 12/02/10 04:23 PM EST
"The only thing the Fed can do in the long run is control the inflation rate,” Bullard said. “And even though we have a dual mandate, we say that our best contribution to the dual mandate is to provide a stable price backdrop for the economy. Then that gives businesses and households a good platform from which they can make all of their decisions — let markets work. And then you get the best allocation of resources that you can.”
Republicans have aired near-unanimous opposition to the Fed's recent actions, including its decision to buy $600 billion of Treasury bonds in a second "quantitative easing" effort, contending it would lead to inflation and a devalued dollar.
Rep. Mike Pence (R-Ind.) introduced legislation last month that would repeal the Fed's dual mandate, which was put in place in 1977. Sen. Bob Corker (R-Tenn.) supported the legislation, and plans to introduce his own bill next year. And the next chairman of the House Budget Committee, Rep. Paul Ryan (R-Wis.), also is planning on introducing a bill removing the dual mandate in the next Congress.
Despite Bullard's comments, a Federal Reserve has officially stated it believes the dual mandate to be "appropriate."
"The Federal Reserve is not seeking a change to its statutory mandate," a Fed spokesperson said.