Art Laffer says Federal Reserve should be controlled by President and Congress

The Federal Reserve should not be an independent entity, economist Art Laffer said Monday on CNBC's "Squawk Box" show.

"To be honest, I do not understand why the Fed is independent," said Laffer, former economic adviser to President Donald Trump and former President Ronald Reagan. "Fiscal policy is not independent.Military policy is not independent.Social policy is not.Why monetary policy, this very powerful tool to control the economy? Should not it be subject to democracy, like any other instrument of government?

Laffer's comments come as Trump continues to criticize the US Federal Reserve, calling it Friday "the most difficult problem" for the United States.

"As well as we do from the day after the big election, when the market jumped, it could have been even better: a huge extra wealth would have been created and used very well," tweeted Trump. "Our most difficult problem is not our competitors, it's the Federal Reserve!"

Trump has repeatedly criticized Federal Reserve Chairman Jerome Powell for appointing him to raise interest rates four times last year and maintain rates this year.

On Monday, Laffer reiterated his badertions last week on "Closing Bell," saying the Fed should be controlled by the legislative and executive branches of government, rather than by independent actors making decisions for the central bank.

"You have this pace and back all the time" because of the difference, said Laffer, co-author of "Trumponomics: Inside the Forefront of America to Revive Our Economy".

"Obviously, there is a difference between the executive and the Fed," he added, adding that the division would continue until the actor was no longer a leader. independent actor.

Last month, Trump presented Laffer – considered the "father" economics of the supply economy – the Presidential Medal of Freedom. Laffer is known for Laffer Curve's theory that raising tax rates beyond a certain point becomes counter-productive for income generation.