WASHINGTON -- A conservative group has launched a campaign to stop Janet L. Yellen from becoming the next head of the Federal Reserve, arguing her confirmation would lead to an expansion of easy money policies that would cause prices to soar.
American Principles in Action, a Washington, D.C., advocacy group, has created a website called NoOnYellen.com and said it planned to spend $25,000 placing a two-minute video on financial websites urging opposition to Yellen, President Obama’s nominee to replace Fed Chairman Ben S. Bernanke.
“Janet Yellen is an enormously well-credentialed economist who also happens to be an inflationist who should not be allowed to run the Federal Reserve,” the group’s chairman, Sean Fieler, president of Equinox Partners, a New York hedge fund, says in the video.
Fieler and others have been concerned that the Fed’s unprecedented stimulus policies would trigger severe inflation, although so far inflation has remained under control.
The video features two other Yellen critics, James Grant, founder of Grant’s Interest Rate Observer, and Daniel Oliver, director of the Committee for Monetary Research and Education.
Grant says in the video that Yellen is “energetic, dynamic, gets things done,” but “would do enormous damage” as Fed chair.
Yellen, the Fed’s vice chair, is a Democrat and viewed as a so-called dove on inflation -- willing to tolerate somewhat higher prices in order to address unemployment. Many conservatives are hawks on inflation, arguing keeping prices low should be the Fed’s chief concern.
The Fed has a dual mandate to maintain price stability and maximize employment. Liberals have strongly supported Yellen’s nomination because of her focus on reducing the nation’s high unemployment rate.
“Ms. Yellen has demonstrated a unique understanding of the impact of the Federal Reserve’s policies on the middle class, particularly the crucial balance between stable prices and low unemployment,” Rep. Maxine Waters (D-Los Angeles) said after Yellen was nominated this week.
As she was nominated by Obama on Wednesday, Yellen said she was committed to both parts of the Fed’s dual mandate.
“We can help ensure that everyone has the opportunity to work hard and build a better life,” she said of the Fed. “We can ensure that inflation remains in check and doesn’t undermine the benefits of a growing economy.”
Although Yellen likely will face opposition from some Republicans in the Senate, she is expected to be confirmed as the next Fed chair. She would be the first woman to hold the position in the central bank’s 100-year history.