We should recognize that if a GAO review and, likely, a congressional hearing were held every time a monetary policy decision deviated from a simple equation, as has been proposed, the Fed would be subjected to the very sort of political pressure from which experience suggests central banks should be independent.
Instead, a modern governance framework calls for the political system to give the central bank a mandate along with the operational freedom to pursue that mandate, supported by transparency and accountability. 19 In addition, using a central bank as a source of revenue to cover the cost of a fiscal program is dangerous to its independence.