Christopher Waller, U.S. President Donald Trump’s candidate for Federal Reserve Governor, listens during a confirmation hearing for the Senate Banking Committee in Washington, DC on Thursday, February 13, 2020.

Andrew Harrer | Bloomberg | Getty Images

The Federal Reserve is not keeping monetary policy simple so the government can continue to run debts and deficits, Fed Governor Christopher Waller said Monday.

Waller defended the Fed’s independence from the Treasury in Congress, disapproving of the notion that the central bank would keep borrowing costs low to service the debt, nor would it buy assets to fund the debt-laden federal government.

“My goal today is to put this narrative to rest for good. It’s just wrong,” Waller said in prepared remarks to the Peterson Institute for International Economics. “Monetary policy was and is not pursued for these purposes.”

As part of its response to the Covid crisis, the Fed cut short-term lending rates to near zero and bought at least $ 80 billion in government bonds and $ 40 billion in mortgage-backed securities every month.

At the same time, the state’s total debt has increased by $ 4.5 trillion, or nearly 20%, since early March 2020, and the deficit for fiscal 2020 was more than $ 3.1 trillion. The Congressional Budget Office has projected a shortfall of $ 2.3 trillion for fiscal 2021, which does not include the recently approved stimulus package of nearly $ 1.9 trillion.

Fed critics say the central bank has been accused of keeping interest rates low so the government can continue to borrow. Although Fed officials have largely welcomed the aggressive fiscal policies, Waller said monetary policy is not designed to keep borrowing costs down.

He also stressed the importance of the Fed’s independence from Congress so that monetary policy is not aligned with political objectives.

“There is a substantial cost to working together when it becomes tax control,” Waller said.

“Congress was fully aware of the potential for political misuse of monetary policy and deliberately created the Federal Reserve as an independent central bank,” he added. “The design features of the Federal Reserve minimize political influence on monetary policy while maintaining accountability to Congress and the electorate for its policies.”

Waller is the latest addition to the Board of Governors and was confirmed in December after being nominated by former President Donald Trump. These are his first public statements.