17 Another proposal would require the FOMC to adopt and follow a specific equation in setting monetary policy and to face immediate congressional hearings and investigation by the GAO whenever the FOMC deviates from the policy dictated by that equation.
18 In the terminology I have used in this speech, these proposals could accurately be described more as restrictions on the Federal Reserve’s instrument independence than as measures that would increase transparency or accountability. They would thus represent a departure from the modern governance structure that has come to characterize the Fed and leading central banks around the world.