First on CNN: Senate Democrat warns Fed it's 'foolish' to keep lifting interest rates

New York(CNN Business) Colorado Sen. John Hickenlooper is pleading with the Federal Reserve to pause its relentless attack on crushing inflation before it does more harm than good.

"High inflation necessitates a response. But the concern is the Fed is doing too much too soon," Hickenlooper wrote in a letter on Thursday to Fed Chairman Jerome Powell. "We should wait to see the effects on the economy and how those changes are absorbed."

The letter, shared first with CNN, is the latest effort by Senate Democrats to persuade the central bank to stop slamming the brakes on the economy. Hickenlooper notes that interest rate hikes are the Fed's "bluntest tool" and officials have already "wielded that hammer repeatedly."

"Raising rates now when prices may come down would be foolish and damaging to American consumers and small businesses," Hickenlooper wrote, adding that the Fed's actions so far have "failed" to knock inflation down.

In a bid to get inflation under control, the Fed has raised interest rates more rapidly than at any point since the early 1980s under legendary Fed chairman Paul Volcker. The central bank is widely expected to deliver another massive rate hike next week.

Noting that Fed policy hits the economy with a significant lag, Hickenlooper argues it would be "prudent" for the Fed to take a beat and evaluate how these historic efforts to fight inflation are impacting the economy.

"I write to urge the Federal Reserve to pause and seriously consider the negative consequences of again raising interest rates," Hickenlooper wrote, adding that families have been stung by surging borrowing costs for homes and cars.

The letter comes just days after Ohio Democratic Sen. Sherrod Brown, chairman of the Senate Banking Committee, warned Powell not to overdo his war on inflation. The caution from Brown is notable because Brown voted in favor of Powell's second term leading the Fed.

Hickenlooper conceded that curbing high inflation is "paramount" but stressed that some causes of price spikes — including Russia's war in Ukraine — are out of the Fed's control.

The Colorado Democrat cited Nobel Prize-winning economist Joseph Stiglitz, who shares that concern.

"Will raising interest rates lead to more oil, lower prices of oil, more food, lower prices of food? The answer is clearly not. In fact, the real risk is it will make it worse," Stiglitz, a Columbia University professor, told CNBC last month.

The letters from Brown and Hickenlooper, on top of far sharper criticism from progressives like Sen. Elizabeth Warren and Rep. Ro Khanna, underscore the rising level of concern in Washington that the Fed will tip the economy into recession.

Of course, no matter how many letters Democrats write to Powell, the Fed chair has pledged to stay out of politics and base the central bank's decisions solely on what is happening in the economy. The White House has repeatedly stressed it respects the Fed's independence, a significant shift from the Trump administration.

Former President Donald Trump repeatedly slammed Powell — his handpicked Fed chairman — for raising interest rates and shrinking the Fed's balance sheet. In 2019, Trump compared Powell to a "golfer who can't putt" and suggested he is a "bigger enemy" than Chinese President Xi Jinping.

Powell "was strong in not getting into a pissing battle with Trump. He stood up to Trump in many ways," David Rubenstein, the billionaire co-founder of Carlyle Group, told CNN last fall.

If the economy stumbles in the coming months, Powell will likely face continued pressure, this time from his left.