Head of Philadelphia Federal Reserve bank warns against politicizing central bank

Philly Fed boss warns against politicizing Fed

WILMINGTON, Del. — The head of the Federal Reserve Bank of Philadelphia is warning against attempts by some in Congress to politicize the central bank.

In a speech Friday to Delaware business leaders, Charles Plosser took aim at a proposal to make the head of the New York Fed a presidential appointee, saying it would skew power toward Washington and Wall Street.

He also criticized a proposal allowing any member of Congress who disagrees with a Fed monetary policy decision to demand an audit by the General Accounting Office.

Plosser also says financial regulatory reform should demonstrate to financial firms deemed “too big to fail” that they indeed will be allowed to fail if they take on too much risk.