WASHINGTON - The Federal Reserve’s chairman, Ben S. Bernanke, continued to defend the Fed’s efforts to control inflation and unemployment during an appearance yesterday before the Senate Budget Committee.
Last month, for the first time, the Fed released a statement describing how it intends to balance those responsibilities, which are set by Congress and which sometimes pull policy in opposite directions. The core of the new doctrine, shaped by Bernanke, is that the Fed will not seek to raise inflation, but if inflation should rise, it may seek to reduce inflation more slowly in order to promote job growth.
Senate Republicans, like their colleagues in the House last week, expressed concern that the Fed is in practice announcing that it will prioritize job growth over inflation.
“It seems to me that you care more about unemployment than about inflation,’’ said Senator Charles E. Grassley, Republican of Iowa.
“I want to disabuse any notion that there is a priority for maximum employment,’’ Bernanke responded.
He told another questioner, Senator Patrick J. Toomey, Republican of Pennsylvania, that the Fed’s approach is “fully balanced and symmetrical.’’
Toomey said that was what he had expected Bernanke to say, but he did not seem pleased.
The hearing was remarkable for the absence of any direct question to Bernanke about the most recent jobs data, released Friday, which showed strong growth in employment during the first month of the year.
Investors and others who watch the Fed have speculated intensely as to whether the improving data will shake the Fed’s commitment to stimulate the economy with low interest rates and other measures. The members of the Senate committee apparently did not share that interest, however.
Republicans sought Bernanke’s affirmation that the job market remains very bad and that the economy remains in poor shape. Bernanke gave his assent.
Democrats asked Bernanke to acknowledge that economic conditions are improving, and he did this, too.
Bernanke also continued to emphasize the need for Congress to set a long-term plan for deficit reduction, saying that this should be done “as soon as possible.’’
“We clearly need some major changes in our fiscal planning, in our fiscal path going forward,’’ he said.
Both parties were stymied in their efforts to extract his support for their approach to creating such a plan. Republicans want to balance the federal budget primarily through spending cuts, while Democrats say the government must increase tax collections, too.
Bernanke, pressed repeatedly, was blunt in response:
“That’s what people elected you to do,’’ he said.