They demanded that the Federal Reserve " board should resist further extraordinary intervention in the U.S. economy, particularly without a clear articulation of the goals of such a policy, direction for success, ample data proving a case for economic action and quantifiable benefits to the American people."
They were not done but rather just getting started.
"It is not clear that the recent round of quantitative easing undertaken by the Federal Reserve has facilitated economic growth or reduced the unemployment rate. To the contrary, there has been significant concern expressed by Federal Reserve Board Members, academics, business leaders, Members of Congress and the public. Although the goal of quantitative easing was, in part, to stabilize the price level against deflationary fears, the Federal Reserve’s actions have likely led to more fluctuations and uncertainty in our already weak economy."
"We have serious concerns that further intervention by the Federal Reserve could exacerbate current problems or further harm the U.S. economy. Such steps may erode the already weakened U.S. dollar or promote more borrowing by overleveraged consumers. To date, we have seen no evidence that further monetary stimulus will create jobs or provide a sustainable path towards economic recovery."
"Ultimately, the American economy is driven by the confidence of consumers and investors and the innovations of its workers. The American people have reason to be skeptical of the Federal Reserve vastly increasing its role in the economy if measurable outcomes cannot be demonstrated."
What is clear is that while they have concerns all right they have nothing to do with the fear that further intervention by the Fed could exacerbate or further harm the economy, if they did they would be all for it.
They claim that QE2 didn't help and indeed may have hurt by somehow adding "fluctuations and uncertainty" to the already weak economy and it is certainly debatable whether or not Operation Twist will work, it's success in the 60s is still debated but what's clear is the GOP is very concerned that it conceivably could work otherwise they wouldn't be criticizing it. It's not therefore impossible that Operation Twist could work or the GOP wouldn't be "warning" against it.
For the GOP's agenda is not Operation Twist but Operation Tank the Economy. This explains the bizarre and strident tones they have been attacking Bernanke in with Right wing religious fundamentalist Rick Perry going as far as claiming that Bernanke's actions amounted to treason. Interesting scale of values, if you try albeit unsuccessfully to help the economy that's treasonous but if you deliberately attempt to tank the economy because you think this will somehow improve your election chances in 14 months that's acceptable, above board behaviour.
It is for the same reason that they voted down a bill to forestall a government shut down yesterday. In this case their hatred for government went as far as begrudging a disaster relief bill demanding that it be balanced with budget cuts to a valuable electric car plan.
So in defense of Ben Bernanke's Operation Twist that the market has been so underwhelmed by: if it had no chance of success the Republicans wouldn't be sending Bernanke warnings.
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