By Steve Rosenbush; Portfolio

Conservative lawmakers and economists are pressing the Federal Reserve to drop its monetary-driven agenda for promoting economic growth in favor of the small-business platform of lower taxes and less regulation. The Wall Street Journal reported Monday that a growing movement, which includes conservative luminaries, such as former Bear Stearns economist and ex-New York Senate candidate David Malpass, are urging the Fed to drop its plans for an additional $600 billion in fiscal stimulus. A manifesto signed by the group will appear this week as ads in the Journal and the New York Times.

Having lowered interest rates about as much as it can, the Fed plans to achieve much the same effect by purchasing government-backed bonds, driving up demand, and thereby pushing up their price and lowering their yield, which moves in the opposite direction. But there's some evidence that the economy is beginning to recover on its own. Just look at today's better-than-expected retail-sales report for October. Given the shifting economic environment, some Fed critics worry that the economy is at risk of generating too much inflation down the road. Price increases are hard to detect now, but once they do appear, it's tougher to get them under control, economists often warn.

"Printing money is no substitute for pro-growth fiscal policy," Representative Mike Pence, a Republican from Indiana whose name has been floated as a future White House contender, told the Journal. He said a "growing chorus" of Americans "know that we should be seeking to stimulate our economy with tax relief, spending restraint, and regulatory reform, rather than masking our fundamental problems by artificially creating inflation."

The issue here isn't so much how Fed policy is going to affect small business. Rather, it may be a question of how the small-business agenda—expressed by the newly powerful Republican delegation in the House—is going to affect the Fed. Over the Labor Day weekend, the Republican-leaning U.S. Chamber of Commerce, the most powerful business lobby, held a conference call and laid out an economic agenda almost identical to Pence's.

"I have never seen a more burdensome agenda for employers…. Employers are saying, 'Wow, if I hire a worker, who knows what I will be exposed to in terms of liability?' Chamber vice president Randel K. Johnson said during the call. He said that removing such barriers was the key to economic growth and had little good to say about the Obama administration's plans for stimulating small business with more loans and tax breaks.

The Fed may or may not favor Wall Street institutions with its policies, as critics suggest. But it speaks the same language and uses the same tools as bankers, traders, and other creatures of the financial markets. It's now confronting a growing opposition with a very different frame of reference, more Main Street than Wall Street.