WASHINGTON - President George W. Bush's chief economist gave the Administration's strongest endorsement to date of Federal Reserve Chairman Ben Bernanke's use of higher interest rates to control inflation if necessary.
"I don't have to worry about inflation because Ben and his partners are doing that right now for usand I think will be successful in controlling it," Edward Lazear, chairman of the White House Council of Economic Advisers, said under questioning before the Joint Economic Committee of Congress. Lazear's expression of confidence in the Fed comes two days before the central bank's policy-setting Open Market Committee meets to decide whether to raise its target for the overnight-bank lending rate a 17th straight time since June 2004 to ensure robust growth doesn't lead to an acceleration of inflation.
While Lazear didn't comment on past or future rate moves, he said he was sure the Fed would set the correct policy.
