The top Republican has warned that the Fed risks being “behind the curve” of inflation

Just out of breakfast with Jay Powell, Pat Toomey sat in the Washington office this week with mixed opinions from the Federal Reserve chair.

“Look, he’s a very skilled guy,” the 59-year-old Pennsylvania Republican senator said in an interview with the Financial Times. “He and I have a lot of disagreement about the size and length of the accommodation. But I have a lot of respect for him personally.”

Toomey Biden has emerged as the main critic of Congress’s severe fiscal response and the Fed’s ultra-monetary policy, challenging the “go big” mantra in Washington.

Toomey declined to say whether he will side with Powell for a second term next year if U.S. President Joe Biden decides to extend the term of the Fed president. But the Fed believes it is making mistakes.

The central bank risks being “behind the curve” in the face of inflation, and the Fed stresses that the current rise in consumer prices will be temporary “we have to wait to see if it disappears,” Toomey said. “All of this increases the risk of more serious action being taken.”

Toomey senses that a bad change is already underway, however, after Fed officials said they expect rate hikes. To begin in 2023, and launched a debate to reduce or “reduce” the purchases of central bank assets.

“The reality is that the reduction is starting. And I would be surprised if it doesn’t start early next year, maybe even earlier. And I think the markets expect that, and the markets can absorb that,” he added.

Toomey has been in the U.S. Senate since 2011, having previously led the Conservative anti-tax group Club for Growth and served in the House of Representatives.

During the interview warn If Republicans choose the first candidate to run with former President Donald Trump, they risk losing their chances of gaining control of Congress in the mid-2022 election.

The reality is that the reduction is beginning. And it would surprise me if it didn’t start early next year, maybe even earlier

But his party believes it should be a strong anti-Democrat case next year, even as the economy is recovering and national polls have shown that many of Biden’s measures, including stimulus controls, remain known.

“All the stops I make in Pennsylvania. I hear people are really worried, ‘how can we spend money at this rate – it’s like someone in Washington thinks Monopoly is money, but it’s not like that,” he said.

Prior to entering politics, Toomey was a derivatives trader and is currently a senior Republican on the Senate Banking Committee and a member of the Senate Finance Committee. Together, the two groups oversee the Fed, Treasury, SEC and USTR, with primary duties in drafting tax, spending and financial legislation.

He was talking on the eve of Toomey Biden treatment with a group of centrist senators from both parties, to raise $ 1 billion in federal funding for infrastructure spending over the next eight years.

Toomey said he hoped to approve the deal, but did not yet know the details. He was pleased that there was no tax increase, and that it was limited to physical infrastructure, at the request of two key Republicans.

But it was not clear that he was paid in a credible way, he said. Funding mechanisms include better tax enforcement, unused stimulus money and the sale of the mobile phone spectrum and strategic oil reserves.

After reaching an agreement on Thursday, he wrote this tweet: “A framework is not legislation, and the actual text matters. I will look into it more in the coming weeks.”

One of Toomey’s biggest, but quixotic, efforts between the parties has been to reach a bilateral agreement on gun reform. He first met with Democrat Joe Manchin in 2013 to propose a background check for all private arms sales in the wake of the Sandy Hook massacre. Today, he acknowledges that “the odds are not good” for turning the bill into law.

“I haven’t had much success convincing my Republican colleagues to do anything about it,” he said, adding that the recent turmoil and financial collapse in the National Rifle Association, the main lobby group for gun owners, would do little to change the dynamic.

“If he left the NRA tomorrow, he would be a replacement,” he said. “[It] it would create because there are a lot of people who feel very strongly about their Second Change rights. ”

In the banking committee, Toomey said it is a “missionary movement” in the climate policy of agencies like the Fed and the SEC and other “ESG” goals.

And he believes that the biggest tension in relations between Republicans and businesses is the rise of “interested capitalism”.

“The extent to which business weighs in on culture wars, so to speak, creates tension,” Toomey said. “I think it’s a bigger problem for a lot of Republicans right now than the whole Trump section.”