By Bo Erickson and Ann Saphir
WASHINGTON (Reuters) - A new task force in the Republican-controlled U.S. House of Representatives on Tuesday begins its examination of the Federal Reserve's policy tools, rules and track record, and members of the panel indicated it will be an effort to reassess the central bank's role and goals.
Its first hearing will be wide-ranging, as the Republicans in charge find the appropriate tenor within the larger House Financial Services Committee, which oversees the central bank and is led by Chairman French Hill.
Representative Frank Lucas, the Oklahoma Republican who leads the Monetary Policy, Treasury Market Resilience, and Economic Prosperity Task Force, has expressed skepticism over the Fed's dual mandate, questioning if its pursuit of maximum employment comes at the expense of price stability.
Other Republicans on the task force said in interviews they seek clarity on the Fed's structure and vision of itself. "My frustration with the Fed is they claim to be a governmental agency when it's convenient, they then claim to be an independent agency when that's convenient," said Representative Bill Huizenga from Michigan.
Representative Monica De La Cruz from Texas riffed on President Donald Trump's campaign slogan and said her goal was to "make lending great again" by examining the "crushing" regulations imposed on community banks by the 2010 Dodd-Frank financial reform law.
Tuesday's hearing starts at 10:00 a.m. EST (1500 GMT). It will not feature any current Fed policymakers, though former Fed Vice Chair Donald Kohn, now at Brookings, is slated to appear. Also expected are Joseph Wang, a former senior trader on the Fed's open markets desk and currently chief investment officer at Monetary Macro, Norbert Michel of the libertarian Cato Institute, and Mike Konczal, former chief economist for the Biden administration's National Economic Council.
The top Democrat on the task force, Representative Juan Vargas from California, said in an interview he will defend the Fed's mandate including employment, as well as the bank's independence.
"I am very concerned that Republicans want to stick -- as they say -- 'the old nose of the camel under the tent' on this one and make the Fed less independent," Vargas said, "I think that's a very bad idea."
Fed watchers are waiting to see the approach of the new panel and if the central bank will interact with and be responsive to the group. The Fed assiduously guards its monetary policy independence, which economists say is critical to a central bank's ability to fight inflation effectively.