As the Federal Reserve pumps billions of dollars into the economy with the hope of stimulating job creation, Republican vice presidential nominee Paul Ryan said that the Fed is bailing out President Obama “at the expense of monetary policy.”
The third round of quantitative easing, known in financial circles as QE3, will enable the Fed to purchase $40 billion of mortgage-backed securities on a monthly basis
“I’m not a fan of QE3. I wasn’t a fan of QE2 either,” Ryan, R-Wis., told Christian Broadcasting Network’s David Brody in an interview conducted Friday but aired today. “In the long run it will do more harm than good but what this is, it’s the Federal Reserve and the monetary policy trying to bail out the fact that we have terrible leadership on fiscal policy from President Obama.”
Ryan said that savers and senior citizens living on fixed incomes “are losers” as a result of the Fed’s move, and he said it “undermines the ultimate credibility of our currency” — something he called “a necessary pre-condition for economic growth.”
“We have loose money already so it’s not a question of having too tight of a monetary policy. We have exceptionally loose monetary policy,” Ryan said. “What we don’t have is White House leadership, Senate leadership on getting this debt under control, on getting tax reform, on cleaning up the regulatory system. We have really bad fiscal policy, it’s crippling growth, it’s why we have the highest poverty rates in a generation, it’s why we have 23 million people out of work.”
During a campaign stop in Pennsylvania on Saturday, Ryan also called the move “sugar-high economics.”
Asked by Brody whether there was “political motivation” behind the nonpartisan Fed’s move, Ryan, the chairman of the House Budget committee, declined to judge Fed chairman Ben Bernanke’s motives behind the timing of the announcement.
“I don’t think that’s something that’s appropriate to do from a perspective of a person in my position but I don’t think it’s a good idea to do this easing,” Ryan said. “The Fed balance sheet is approaching around three trillion dollars. This kind of easing hurts savers, questions the credibility of our currency and I think ultimately the costs outweigh the benefits.”
Ryan is on a three-state campaign swing today, stopping in Indianapolis, Ind. and Des Moines, Iowa before traveling to Bedford, Mass. later this evening.