I have a couple of questions:
Is it a good idea to raise interest rates while the economy is barely limping along?
Also is this a liberal vs conservative issue?
It is not, anyone that tells you different either doesn't know what they're talking about and/or doesn't know history. Read up on Fed actions in 1931 onwards following Britain defense of the pound.
It's a dogma combined with ignorance issue. I'm beyond amazed that this nonsense continues to this day:
"Liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate… it will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people."
- Andrew Mellon, 1929
(Additionally, he advocated weeding out "weak" banks as a harsh but necessary prerequisite to the recovery of the banking system. This "weeding out" was accomplished through refusing to lend cash to banks (taking loans and other investments as collateral), and by refusing to put more cash in circulation. He advocated spending cuts to keep the Federal budget balanced, and opposed fiscal stimulus measures. ) from wiki
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