06.09.2017

NEW YORK - Low-income workers are gathering Monday, June 12, at three major Federal Reserve banks to call on the Fed not to raise interest rates this week on the basis of an arbitrary inflation target. The Fed’s rate-hiking path is hurting the American economy, particularly the Black, Latinx, and rural communities that have still not recovered from the financial crisis a decade ago.

The protests signal an important new demand from the Fed Up campaign, which has for three years pushed the Fed to keep interest rates low in pursuit of genuine full employment: the campaign is now calling on the institution to formally revise its approach to policy-setting by abandoning the 2% inflation target.

Simultaneous protests will be held in Washington D.C., New York City, and Philadelphia Monday afternoon, ahead of the rate-setting meeting on Tuesday and Wednesday. Over the last 18 months, the Fed has embarked on a program of deliberately slowing down the economy by raising interest rates, despite the continued unnecessarily high rate of underemployment and low wages  across the country. The Fed’s hikes, which fly in the face of still-too-low wage and price growth, prove the urgent need for a new decision-making formula..

Protesters in the three cities will distribute copies of a new letter from 22 prominent economists urging the Federal Reserve to formally re-evaluate its 2% inflation target, which they believe is too low to promote job and wage growth.

On Friday, the Fed Up coalition held a press call to urge the Federal Reserve to formally re-evaluate its inflation target via a blue-ribbon commission. The call (please find the recording here) featured remarks from Jason Furman, Joseph Stiglitz, Brad DeLong, and Josh Bivens to discuss the letter that they signed. On the call, Bivens summarized his accompanying white paper,  “Is 2% Too Low? Rethinking the Fed’s Arbitrary Inflation Target to Avoid Another Great Recession.”

The letter reflects a growing belief among an array of economists from various backgrounds that the Fed’s existing two percent inflation target no longer works in a 21st century post-recession economy that has seen inflation remain low and stable despite seven years of zero interest rates.

If you would like more information about the actions scheduled for Monday, June 12, please email ajain@populardemocracy.org.

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www.thepeoplesfed.org

Fed Up is a coalition of community organizations, labor unions, and policy experts  across the country calling on the Federal Reserve to reform its governance and adopt policies that build a strong economy for the American public. The Fed can keep interest rates low, give the economy a fair chance to recover, and prioritize genuine full employment and rising wages for all communities

Media Contact:

Anita Jain, ajain@populardemocracy.org, 347-636-9761