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US Fed’s Fisher says, US Congress has been a disgrace on nations fiscal issues

A veteran US central-bank official warned Thursday Congress needs to get its fiscal house in order, and added the Federal Reserve will nnot be there to bail out legislators if they fail.

“Our Congress–past and present–has behaved disgracefully in discharging its fiscal duty,” Federal Reserve Bank of Dallas President Richard Fisher said. Noting “there are limits to what a monetary authority can do,” the official said. “Only the Congress of the United States can now save us from fiscal perdition. The Federal Reserve cannot.”

The Fed can’t be “endlessly purchasing US Treasuries and agency debt” because doing so would “encumber future generations of central bankers with Hobson’s choices when it comes to undoing what seems contemporarily appropriate,” he said.

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Chastising the nation’s elected leaders for fiscal irresponsibility has long been on Mr. Fisher’s agenda.

His comments come as legislators and President Obama get ready to tackle what is known as the fiscal cliff: a combination of automatic tax increases and spending cuts set for year-end that, left in place, could send the nation into recession. Most economists hope political leaders will be able to modify current law in a way to soften the economic impact of the situation.

Mr. Fisher, who is not now a voting member of the interest-rate-setting FMOC, made his comments in the text of a speech to be delivered at the State of the West Symposium in Stanford, CA. The official had little to stay about the outlook for monetary policy. He did note inflation and expectations of future inflation are ” tame” at a time of “disproportionate” underemployment.

Mr. Fisher spent most of his formal remarks on a bid to understand why Texas has outperformed California economically.

“Texas is hardly a paradise,” he said. “We are admittedly miserly with our social welfare programs. We fall short in many other social metrics,” Mr. Fisher said.

California seems to have lost the balance between “social and environmental responsibility and the capacity to provide for a prosperous economy,” and because of that, “it is costing California jobs and people and is depleting its revenue coffers,” he said.