Campaign News

The Democratic national platform’s language calling for a more diverse Federal Reserve and for the promotion of full employment is historically progressive, but it still could be stronger, some activists say.

Advocates on the “Fed Up” campaign, led by the progressive Center for Popular Democracy, are pleased that the platform — amended in a committee meeting over the weekend — includes language that supports banning commercial bankers from Fed leadership.

But the activists are still hoping for more explicit support bolstering the Fed’s mandate to promote “full employment,” said Jordan Haedtler, Fed Up’s campaign manager.

As it stands, the platform committee adopted an amendment to “protect and defend the Federal Reserve’s independence to carry out the dual mandate assigned to it by Congress — for both full employment and low inflation — against threats from new legislation.”

An amendment promoted by Fed Up would have sketched out a more detailed stance on full employment, but it failed 70-100 at the meeting. That amendment stated: “The Federal Reserve should be a fully public institution that serves the American people and pursues a genuine full employment economy that creates good jobs and rising wages for all.”

Haedtler said the platform’s language about protecting the the Fed from “the threat” of new legislation might actually be counterproductive. His group hopes to lay the groundwork for legislation overhauling the central bank during the next administration. It is likely, however, that the platform writers were referring to legislation from conservatives to abolish the Fed or severely shrink its capabilities.

“I appreciate that full employment is fleetingly mentioned, but the fact is that sound new legislation regarding the Federal Reserve is necessary,” Haedtler told Morning Consult in an interview.

Democrats in Congress have also pushed for more diversity in the Fed’s top layer. Sen. Sherrod Brown of Ohio, ranking Democrat on the Senate Banking Committee, pressed Fed Chair Janet Yellen during a recent hearing for a commitment to fixing the bank’s diversity problem.

“Diversity is an extremely important goal, and I will do everything I can to advance it,” she told him.

The words “full employment” haven’t appeared in a Democratic National Committee platform since 1988, Haedtler said. But Fed Up hopes to see the language bolstered further in the platform’s preamble.

“This is not as strong as past mentions of full employment in Democratic platforms going back several decades, where the fact that the Federal Reserve has a role in creating full employment is more fleshed out and a plan for how to get there is described,” he said.

The Fed Up activists also want to amend the platform to outline the Fed’s path to becoming a fully public institution.

By TARA JEFFRIES

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NPR - March 6, 2015, by  Yuki Noguchi - The cold weather did not hamper hiring last month. Employers added nearly 300,000 jobs to payrolls, and the unemployment rate fell to 5.5 percent.

Despite another strong report, there is little evidence that all the hiring is putting upward pressures on wages.

And there are more than 6.5 million people working part time who would like to have more hours.

Randa Jama pushes airline passengers on wheelchairs to their gates at the Minneapolis-St. Paul International Airport. This had been a full-time job when she took it last fall, but then a couple of months later, that changed.

"They told me that you're working only Saturday and Sunday from now," she says.

That cut her hours to 12 a week. Sometimes, her supervisors ask her at the last minute to stay late or do an extra shift. Since she cut back on babysitters, she can't accommodate.

"I let them go because they can't just wait for me to get full time. Now that I want to work full time, no I can't because obviously I changed everything," Jama says.

Higher wages are just one issue workers like Jama care about. They say getting enough hours — and a predictable schedule — are equally important in order to enable them to find additional work or deal with the other obligations in their lives.

"Nowadays you have to say you have open availability and that you're free to work whenever," says Aditi Sen, a researcher for the Center for Popular Democracy, a worker advocacy group.

But pledging open availability limits a worker's ability to plan or get other work.

So far, the law has little to say when it comes to scheduling.

Some states, including Minnesota, Connecticut, Maryland and Massachusetts, are considering legislation that would require several weeks advance notice of schedule changes and institute minimum time off between shifts.

Shannon Henderson says she needs more control over her constantly shifting work schedule. The single mom of two says she asks for more than the 33 hours a week she typically gets working at the Wal-Mart in Sacramento, Calif. But that's also stressful.

"In order to get hours, you have to have open availability," she says. "For instance, last week I worked all late shifts, which was 2 to 11. And then this week I had all early shifts, which was 6:30 to 2."

Wal-Mart last month promised to raise its base wage and give workers more control over their schedules.

Henderson worries the store won't give her more control without cutting back on her hours. She looks for more steady work when she can.

"I do look. But the thing is, with the scheduling being all over the place, it makes it hard for me to actually set time to go look," she says.

Neil Trautwein, vice president of health care policy at the National Retail Federation, says, "Unquestionably those are some difficult hours."

Trautwein says retailers are balancing the consumer demand for 24/7 service, with employees' scheduling concerns. Wal-Mart, he says, is responding to workers' demands.

"That's the way the market self-adjusts and self-regulates," he says.

Jason Diaz, a server at a restaurant in New Haven, Conn., says in order to work 40 hours a week, he's constantly looking for extra gigs.

"Finding the place is the first problem," he says. "And then finding out how to manage that, and travel cost expenses and still being to my next job on time is pretty difficult."

He spends his remaining time trying to find a full-time job and taking care of his son.

"Just in the last two weeks, I got an email from my boss saying, 'Hey, you have to work on Tuesday, so figure out what you're going to do with your son,' " he says.

So Diaz canceled his son's drum lesson and found babysitting, only to discover his boss had made a mistake and he didn't have to work, after all.

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For some corporations and advocacy groups, Colorado's jam-packed ballot has meant opportunity.

And they don't just care about political candidates. In fact, issue committees — which stand on the front line of fights over proposed amendments and propositions — have raised more than 10 times the amount of money of Colorado Democrats and Republicans seeking state or local office. These committees have drawn in more than $86 million, a staggering difference when compared to the approximately $7.3 million raised by state and local Democrats and Republicans.

These statewide issue fights — this year races concerning ColoradoCare, the minimum wage and a so-called "right to die" proposition have dominated much of the conversation — can give out-of-state groups a chance to get more bang for their buck and jump into statewide elections, which might affect their bottom line more than federal races, Colorado State University political science professor Bob Duffy said. States like Colorado are less expensive to campaign in than, say, California, which makes it appealing for groups looking to affect legislation without breaking the bank, he said.

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"Typically those elections are cheaper and also low-information elections," he said, pointing out that sometimes people have less information about statewide ballot measures than more high-profile races. "So a little money can go a long way. A big fish can have a much bigger impact in a small pond than they can in a big pond."

In the fight over Amendment 72, for example, the parent company of tobacco giant Philip Morris has bankrolled No Blank Checks in the Constitution, a group fighting against the proposed hike in cigarette taxes. Philip Morris is one of the largest tobacco companies in the world, and is known for products including Marlboro cigarettes. It has so far spent more than $16 million on the campaign. That alone is more than Democrats and Republicans running for state and local offices have raised.

"Obviously cigarette sale declines puts a real crimp in their bottom line, and they have an opportunity (to fight it), and it's probably cheaper to do it here than in California, for example," Duffy said.

Oftentimes out-of-state groups will use statewide races as a test case to see how effectively they can influence it — and again, it makes most sense to do that in a less-expensive race than in a large state with lots of media markets — and sometimes it's meant as a warning shot to groups who might be considering similar legislation in other states, Duffy said.

Opponents of the "right to die" proposition have gotten much of their funding from Catholic groups. The Archdiocese of Denver, for example, has contributed more than $100,000 to the campaign fighting Proposition 106, which would allow physicians to prescribe lethal doses of medication to terminally ill patients who met certain criteria so they could end their own lives.

Colorado Families for a Fair Minimum Wage, a group advocating for Amendment 70, which would raise the state's minimum wage to $12 an hour by 2020, has raised almost $5 million, including more than $1 million from the Center for Popular Democracy Action, a New York-based advocacy group which focuses on several social justice issues. Keep Colorado Working, a group opposing the hike, has raised about $1.7 million, and has also received out-of-state support, including $50,000 from Florida-based Darden, the company that owns Olive Garden and LongHorn Steakhouse, among other brands.

"Especially after 2010, some federal election rulings unleashed some money," Duffy said, referencing a few court decisions on campaign finance, included Citizens United. "The floodgate really opened up."

By Alicia Stice

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PBS - November 21, 2014, by Simone Pathe - One recent brisk morning in the nation’s capital, about 30 community leaders and workers from around the country, all clad in matching green T-shirts, posed for a group photo on Constitution Ave. Ten guards huddled at the top of the walkway separating them from the Federal Reserve.

The workers weren’t protesting. They weren’t sightseeing. They were there to meet Janet Yellen.

“That’s a big deal,” said former Fed vice chair Alan Blinder.

Friday marked the third time in the past month that Yellen has been in the public eye for engaging with the public, or at least with economic issues much more on their minds than, say, quantitative easing.

First, it was her speech at a conference on inequality organized by the Boston Federal Reserve. On that same trip, she met with the jobless at a nearby community center. And then, she posed for selfies.

The string of incidents has raised questions about the public face of the Fed, and when it’s appropriate for Yellen, an unelected government official with enormous power, to inject herself into public debates that may have political overtones.

“I see no harm in her talking and listening to people,” said Michael Strain, an economist at the conservative American Enterprise Institute. “But those situations can magnify and invite off-the-cuff remarks.”

Yellen certainly doesn’t want to be a politician, said Alan Blinder, vice chair of the Fed under Bill Clinton. But making those off-the-cuff remarks is an “occupational hazard” of the position, he added, especially when testifying in front of lawmakers. Some chairs have handled it better than others, and both Blinder and Strain agree that Yellen’s comments about inequality were slight as indiscretions come. Alan Greenspan was famous for weighing into policy debates too freely, as when he endorsed George W. Bush’s plan to privatize Social Security in 2005. That behavior inspired Ben Bernanke to shy away from any incursions into the public dialogue unrelated to monetary policy.

Bridging the gap between the public dialogue and what’s arguably the most powerful economic institution in the world is exactly what Yellen has been doing.

While her remarks about inequality have sparked the most controversy, her invitation to a coalition of community organizers, labor leaders, low-wage workers, faith leaders and liberal economists is the farthest step she’s taken toward involving the public in the Fed and its policies. She didn’t just meet the “Fed Up” campaign, as they call themselves, in a spare conference room. They sat in the inner sanctum of one of the most cloistered agency’s of the U.S. government — the board of governors meeting room, where the Federal Open Market Committee meets in private to decide monetary policy.

Fed Up’s tagline — “What recovery?” — illustrates the disconnect between the two-thirds of voters who told exit pollsters earlier this month that the economy is getting worse and headline economic figures that are growing stronger. Unemployment is now as low as it was before the recession. But wages are barely keeping pace with inflation, while unemployment for some demographics and geographic regions remains much higher than the average. Nationally, African Americans were unemployed at a rate of 10.9 percent in October. In Atlanta, the unemployment rate for blacks is nearly 14 percent, according to an analysis by the Economic Policy Institute, one of the parties to the Fed Up campaign.

Workers didn’t travel to Washington to protest Yellen, said Amador Rivas, of Harlem; they just wanted her to hear what’s happening on the ground. Jean Andre echoed those remarks. Andre, a member of New York Communities for Change, used to do locations support in the film industry. “You know, one of those names at the end of the movie that no one reads,” he said. He lived a middle-class lifestyle. But after the financial crash, he lost his home and struggled to find a full-time job to pay for a mortgage modification.

Jean Andre, a member of New York Communities for Change, speaks at an Oct. 14 press conference before Fed Up’s meeting with Yellen. Photo by Simone Pathe.

To some on the right, though, Yellen’s meeting looked like it was going beyond a simple meet-and-greet with the public. American Principles in Action blasted her for discussing monetary policy “with representatives of an extreme political view,” and requested a similar meeting for a chance to express their concerns with low interest rates.

Fed Up does have an agenda when it comes to monetary policy: they want the Fed to keep interest rates low to stimulate jobs and, they argue, higher wages. They’d also like the Fed to buy municipal bonds as a form of lending to cities and states.

Their campaign took off earlier this month with a call to democratize the very table at which they met Friday. In early 2015, the presidents of the regional Federal Reserve banks in Philadelphia and Dallas are stepping down, and Fed Up called on the board of governors and regional banks to release the names of possible successors and to give the public input, if not the opportunity to serve on the regional boards. (The Philadelphia Fed on Friday morning released the name of the search firm vetting candidates, which has established an email to receive public inquiries.)

“The Fed is too important of an institution to be insulated from the voices and perspectives of working families,” said Ady Barkan, an attorney at the Coalition for Popular Democracy, the group that organized the meeting.

That’s why Friday’s meeting with Yellen was so significant for them. “The people who are the true consumers who finance the economy finally have a chance to have input,” Andre said. The meeting was a significant event for the Fed, too. “We had Wall Streeters in the building all the time,” Blinder said, reflecting on his time as vice chair. This “signals the Fed is as interested in these groups as the financial markets.”

Even if their message resonates, though, the Fed, and Yellen as its public face, does not necessarily have authority to address every plight of working Americans. Yellen has herself said many times that wages are still too low in this recovery. “If they’re trying to elicit sympathy that wage earners aren’t making enough,” Blinder said about Fed Up, “they’re preaching to the converted.”

The “Fed Up” campaign gathers for an Oct. 14 press conference outside the Federal Reserve before meeting with Chair Janet Yellen. Photo by Simone Pathe.

The central bank has no control over wages, except in the sense that wages typically rise in a tighter labor market, said Blinder. Holding short-term interest rates low is supposed to boost employment, and it has — unemployment has dropped from above 10 percent to below 6 percent — but so far, that’s done little for wages.

As for buying municipal bonds to lend to cities and states in need, Blinder doesn’t think that’s the Fed’s business, even if it does have the legal authority to do so. Its dual mandate to maintain full employment and stable prices is about national economic policy, he said, and there’s no way it would be able to choose which states’ bonds to buy.

Likewise, the Fed has no policy tools to directly address economic inequality. That’s why Yellen’s Oct. 17 speech, more than anything else, has left Blinder, a close friend, and Strain, who still thinks she’ll “make a great chair,” feeling uneasy.

Of course, the Fed isn’t totally removed from the debate over inequality. The central bank conducts research on the subject as an economic phenomenon, and the Boston Fed organized the entire October conference at which Yellen spoke around the topic.

In fact, plenty of the Fed’s critics accuse the central bank and its bond buying program of contributing to the divide between Wall Street and Main Street. “The fact that quantitative easing has driven up the stock market to what some would call dizzying heights does in fact exacerbate wealth inequality,” Blinder said. But to him, that’s just collateral damage. “If the instruments you have are limited and work through financial markets,” he added, “that’s going to be a side effect.”

But reduced income inequality can also be a side effect of the Fed fulfilling its mandate. Blinder pointed to the second Clinton Administration as a period when plentiful jobs — “if your breath showed in the mirror you could get a job” — slowed the growth in the gap between top and bottom earners. (Clinton’s economic legacy — including his administration’s impact on inequality — is a subject of continuous debate.)

The “Fed Up” campaign isn’t interested in side effects, though. Their mission statement singles out the Fed for its ability to make a difference in the lives of working Americans: “President Obama, Congress, and most state legislatures have failed to strengthen the economy — and have often made things worse. But the Federal Reserve has tremendous power over the economy.”

That power is precisely why Blinder and Strain agree that the Federal Reserve must be insulated from politics. Talking to labor, community leaders and Wall Street is important, said Blinder, but the transparency for which Bernanke, and now Yellen, has been lauded is about monetary policy, not taxes or inequality.

For many conservatives, Yellen crossed the line with her Boston remarks, especially when she said, “The extent of and continuing increase in inequality in the United States greatly concern me.”

To Strain and others on the right, Yellen sounded far too Democratic in her concerns about inequality, as she did when she alluded to universal pre-k, another policy priority often associated with the Democratic Party.

Did Yellen betray herself as too blue? Richard Reeves, a fellow at the Brookings Institution, doesn’t think so. The substance of Yellen’s speech offered more to conservatives, he wrote, particularly her acknowledgement of business ownership and inherited wealth as “building blocks” of opportunity in the United States.

Republicans in Congress may not see it that way, though, which is another reason Yellen’s remarks worried Strain. He’s afraid they’ll only fuel GOP efforts to rein in the central bank. There’s a reason Congress doesn’t have oversight over monetary policy: it doesn’t mix well with politics, said Blinder. “You’d get too high inflation because there’s the temptation, among all these politicians, to juice up the economy just before elections.”

For Fed Up organizers, though, Yellen’s meeting with them last Friday is not a sign she’s identifying with either party, but that the Fed can be, in the words of the Kansas City Rev. Stanley Runnels, of Communities Creating Opportunity, “an unconventional source of hope” for millions of Americans.

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