Yellen Meets With Activists Seeking Fed Reforms
ABC News - November 14, 2014, by Martin Crutsinger - A coalition of community groups and labor unions are "fed up" with the Federal Reserve.
More than two dozen activists demonstrated...
ABC News - November 14, 2014, by Martin Crutsinger - A coalition of community groups and labor unions are "fed up" with the Federal Reserve.
More than two dozen activists demonstrated outside the Fed and then met with Chair Janet Yellen on Friday as part of a new campaign seeking policy reforms and a commitment to keep interest rates low until good jobs are plentiful for all workers. Although the labor market has steadily strengthened this year, wages have remained stagnant.
During the hour-long discussion with Yellen and three other Fed board members, coalition representatives discussed problems their communities were facing with high unemployment and weak wage growth.
Ady Barkan, one of the organizers of "Fed Up: The National Campaign for a Strong Economy," said Yellen and the other Fed officials listened but made no commitments about future Fed policy.
"It was a very good conversation," said Barkan, an attorney with the Center for Popular Democracy in Brooklyn. "They listened very intently, and they asked meaningful follow-up questions."
Fed officials confirmed that the meeting took place but declined to comment on the issues raised at the meeting.
The Fed's outreach to community activists was the latest move by Yellen to focus attention on lingering problems from the Great Recession. Wearing green tee-shirts with the phrase "What Recovery?" the group had protested outside of the Fed's headquarters on Constitution Avenue under the watchful eye of nine Fed security officers.
Members of the group, some of whom had demonstrated at a central bank gathering in August in Jackson Hole, Wyoming said it was important that Fed officials not be swayed by arguments that it needs to move quickly to raise interest rates to make sure inflation does not become a threat.
"The banks are the ones that crashed the economy ... but they're the ones who got the bonuses and the bailouts while workers and homeowners like me were left to drown," said Jean Andre, 48, of New York, who said he was having a tough time finding full-time work.
In addition to Yellen, the Fed officials who took part in the meeting were Fed Vice Chairman Stanley Fischer and Fed board members Jerome Powell and Lael Brainard.
Members of the coalition said about half of the meeting was taken up by their members telling stories about the difficulty in finding jobs, particularly in disadvantaged groups and communities dealing with unemployment much higher than the 5.8 percent national average.
The Fed officials also were presented a petition signed by 5,000 people around the country urging the central bank to keep interest rates low until the country reaches full employment.
The group also pushed for a more open process in the selection of presidents of the Fed's 12 regional banks. They say the current process is too secretive and dominated by officials from banks and other businesses with little input from the public. The regional presidents, along with Fed board members in Washington, participate in the deliberations to set interest rates.
Source
Snowy Protest at Philly Fed
The Inquirer - March 5, 2015, by Joseph DiStefano - Ten cold protesters from a national group called Fed Up gathered at the Federal Reserve of Philadelphia in the storm this afternoon to urge the...
The Inquirer - March 5, 2015, by Joseph DiStefano - Ten cold protesters from a national group called Fed Up gathered at the Federal Reserve of Philadelphia in the storm this afternoon to urge the Fed to pay more attention to boosting employment and listening to groups representing wage workers and poor people.
The group, which includes labor union and church groups as well as local affilates such as North Philadelphia-based Action United, says its national leaders met with Federal Reserve Chairman Janet Yellen in Washington last year, but they have had a tough time getting Fed officials who oversee regional banks and regulatory teams, such as Charles Plosser, the free-market economist who retired in January as the Philly Fed President, to take them seriously. Other Fed Up affilates held protests in New York, Charlotte, St. Louis, and other Fed cities today. More are planned, said Shawn Sebastian of the liberal, Brooklyn-based Center for Popular Democracy, one of the groups supporting Fed Up.
"Plosser never gave us a meeting," said Action United leader Kendra Brooks, who said she's been organziing poor people to press for improved government job, education and housing programs since she was laid off from her management job at an Easter Seals affiliate in 2012. Herb Taylor, a veteran community-development manager for the Philly Fed, and other local Fed officials did meet with a Fed Up delegation last fall, and Philly Fed leaders have also held meetings with labor unions and community groups, Fed spokesman Jim Ely reminded the group.
"But they gave us crumbs," said Brooks, noting that labor and community-group leaders were not part of the inner circle who selected Plosser's replacement, University of Delaware President Patrick Harker, a Philly Fed board member who will take the top Philly Fed job in July.
Under Ed Boehne, Philadelphia Fed President from the 1970s into the 1990s, the Philly Fed forced banks to expand their inner-city direct-lending programs and ensured labor representation on the Fed board.
Brooks questioned whether Boehne's successors share that committment to listening to and serving all sectors. She said corporate executives like Comcast chief financial officer Michael Angelakis and investor James Nevels, who led the committee that chose Harker, don't represent a wide range of residents of the Philadelphia Federal Reserve district, which covers eastern Pennsylvania, South Jersey and Delaware.
"Comcast does not represent our community, the universities do not represent the community. We need our voices to be heard, also," she said.
Group leaders said they are frustrated the Fed has not pushed banks to be more flexible in setting payment terms for stressed homeowners, or show the forebearance banks often show to troubled corporate borrowers.
Action United member Lionel Rice said he's running out of time. He said he hadn't been able to find a job paying more than fast-food wages since he was laid off after 20 years at the Penn Maid dairy plant in Northeast Philadelphia three years ago. He said a housing finance agency is preparing to foreclose on his home in Olney.
Ely said he would bring the group's petition to Fed officials' attention.
Source
Let’s Be Real Episode 6: We’re Fed Up!
This episode, we take a look at a campaign that focuses on the Federal Reserve System and its impact on working people and people of color. We take you to a rally in front of the Federal Reserve...
This episode, we take a look at a campaign that focuses on the Federal Reserve System and its impact on working people and people of color. We take you to a rally in front of the Federal Reserve Bank of New York where we spoke with two protesters about how the Fed impacts their communities. Then, we sit down with the Director of the Center for Popular Democracy’s Fed Up! Campaign to hear about the fight to put working people and communities of color at the center of the Fed’s decision-making process.
Read the full article here.
One city’s crime-fighting quandary: Where exactly to invest?
![](/sites/default/files/newsdefault.jpg)
One city’s crime-fighting quandary: Where exactly to invest?
Chicago spends 39 percent of its municipal budget on policing, while New York spends just 8 percent and Los Angeles spends 26 percent, according to a report released last year by the Center for...
Chicago spends 39 percent of its municipal budget on policing, while New York spends just 8 percent and Los Angeles spends 26 percent, according to a report released last year by the Center for Popular Democracy. This means the city has less funds for things like schools and social services. The proposed $95 million academy comes just five years after the city announced the biggest mass closing of schools in US history, shutting down 50 schools because of a $1 billion budget shortfall.
Read the full article here.
Internal Emails Show ICE Agents Struggling to Substantiate Trump’s Lies About Immigrants
![](/sites/default/files/newsdefault.jpg)
Internal Emails Show ICE Agents Struggling to Substantiate Trump’s Lies About Immigrants
As hundreds of undocumented immigrants were rounded up across the country last February in the first mass raids of the Trump administration, Immigration and Customs Enforcement officials went out...
As hundreds of undocumented immigrants were rounded up across the country last February in the first mass raids of the Trump administration, Immigration and Customs Enforcement officials went out of their way to portray the people they detained as hardened criminals, instructing field offices to highlight the worst cases for the media and attempting to distract attention from the dozens of individuals who were apprehended despite having no criminal background at all.
Read the full article here.
Fed Splits Evident Amid Wait for Yellen: Jackson Hole Journal
Bloomberg News - August 22, 2014, by Jeff Kearns, Simon Kennedy and Michael McKee - Divisions within the Federal Reserve over how long to...
Bloomberg News - August 22, 2014, by Jeff Kearns, Simon Kennedy and Michael McKee - Divisions within the Federal Reserve over how long to keep easy monetary policy are already in evidence in Wyoming as investors prepare for Chair Janet Yellen’s keynote speech.
Fed Bank of St. Louis President James Bullard told Bloomberg Radio that the U.S. central bank may begin tightening monetary policy earlier than officials previously expected.
“The evidence is leading toward an earlier increase than would have been in the works earlier this year,” said Bullard. “Labor markets have improved quite a bit relative to what the committee was thinking.”
Bullard spoke after Kansas City Fed President Esther George told Bloomberg Television that broad-based employment gains suggest the U.S. economy is strong enough to withstand higher interest rates. Philadelphia Fed President Charles Plosser, who voted against the Fed’s policy statement last month, told CNBC he’s concerned about the Fed not adjusting policy appropriately.
By contrast, Atlanta Fed President Dennis Lockhart urged more patience, warning in a separate interview with Bloomberg Radio against “moving prematurely and snuffing out some progress.”
* * *
Robots don’t steal jobs, the U.S. labor market is less flexible than it was and workers haven’t suffered unprecedented periods out of work.
Photographer: Bradly Boner/Bloomberg
Fed Chair Janet Yellen arrived at the dinner to be greeted by about 10 people wearing bright green T-shirts emblazoned with “What Recovery?” and carrying placards with labor market data. Close
Those are among the conclusions of papers being presented at the symposium. Here is a review of their contents, which can be read in full on the Kansas City Fed’s website.
Robots and computers don’t steal as many jobs as some believe, and automation actually benefits many workers, Massachusetts Institute of Technology Professor David Autor said in his paper.
A key reason humans aren’t obsolete yet is that simple tasks such as visually identifying a chair, which any child can do, aren’t so easy for engineers to teach to computers, Autor said.
“Journalists and expert commentators overstate the extent of machine substitution for human labor and ignore the strong complementarities that increase productivity, raise earnings, and augment demand for skilled labor,” he wrote. “Challenges to substituting machines for workers in tasks requiring flexibility, judgment, and common sense remain immense.”
* * *
The U.S. labor market became less fluid in recent decades partly because of an aging workforce, a shift to older businesses, and the spread of occupational licensing and certification, economists Steven J. Davis and John Haltiwanger wrote in their paper.
The economists define labor market fluidity as “flows of jobs and workers across employers.” The paper found the U.S. “underwent a large, broad-based decline in the pace of labor market flows in recent decades.”
“An aging workforce is a factor behind the slowdown of worker reallocation,” the paper said.
* * *
U.S. workers in the aftermath of the 2007-2009 recession haven’t experienced unprecedentedly long bouts of non-employment, according to a paper by economists Jae Song and Till von Wachter.
Their findings “suggest that the potential for hysteresis in the aftermath of the Great Recession is moderate,” the paper said. Hysteresis posits that people out of work for too long have a harder time finding work, leading to a persistent decline in the employment-to-population rate
* * *
Policy makers would benefit from a better understanding of labor markets, economist Giuseppe Bertola argued in a paper that weighed the impact of rules making those markets rigid or flexible.
Rules that protect workers from job losses and provide more generous unemployment benefits can soften and smooth shocks to the economy, said Bertola.
* * *
George opened the symposium late yesterday by putting the presenters on the spot.
The last conference devoted to labor markets was 20 years ago, George told the group of almost 200 as they ate steak and salmon dinners beneath elk antler chandeliers.
The presenters and discussants back then included five future Nobel Prize winners and two academics who would go on to be central bankers: Bank of England Deputy Governor Charles Bean and Stanley Fischer, the Bank of Israel governor who became Fed vice chairman in June. Fischer sat at one of the front tables last night.
“So for those of you that will be on the program,” George said to laughter, “We’re either setting you up for a blessing or a curse.”
This year’s topic is “Re-Inventing Labor Market Dynamics.” In 1994 it was “Reducing Unemployment: Current Issues and Policy Options.”
George said she went through the 1994 proceedings only to find central bankers and economists are still grappling with some of the same basic issues today.
“I saw that the discussion included things like the decline in demand for low-skilled workers due to technology and the challenge of the long-term unemployment,” George said. “And questions were raised by that symposium, as they are today, about the usefulness of the unemployment rate as a measure of economic slack.”
It reads like a list of the most vexing issues the Fed faces now and will be attempting to tackle today and tomorrow.
* * *
Fed Chair Janet Yellen arrived at the dinner to be greeted by about 10 people wearing bright green T-shirts emblazoned with “What Recovery?” and carrying placards with labor market data.
The protesters had traveled to Wyoming to highlight the plight of “struggling workers from around the country” who want the Fed to pursue “full employment that reduces poverty and expands the middle class,” according to the Center for Popular Democracy, a Brooklyn-based organization. The backs of their T-shirts had a graph comparing the performance of wage growth among the top 1 percent and the rest.
Ady Barkan, a staff attorney with the group, spoke briefly with Yellen at the door of the lodge’s Explorers Room. “She said she understands the issues we’re talking about and is doing everything they can,” he said, after she had entered the room.
Yellen has regularly cited weak labor markets as a scourge of the economy she’s trying to boost with easy monetary policy.
Shemethia Butler, who works part time at a McDonald’s Corp. restaurant in Washington, was one of those to make the trip. The 34-year-old said that while she isn’t up on monetary policy, she wants policy makers to know she fears higher interest rates for her and her community. She said she works 25 to 35 hours a week for $9.50 an hour at a job she’s had for just over a year. Before that she was unemployed for two years.
“There’s no recovery,” Butler said. “The economy is broken because there aren’t enough jobs for people like me.”
* * *
Yellen’s speech will be the main event of the first full day of the conference. She will speak at 8 a.m. Mountain Time today.
Her address will be followed by the presentation of the paper by Davis and Haltiwanger.
Autor will then discuss job polarization before a panel on demographics featuring Karen Eggleston of Stanford University, David Lam of the University of Michigan and Ronald Lee of the University of California, Berkeley.
European Central Bank President Mario Draghi will deliver the keynote luncheon speech.
Tomorrow, Von Wachter and then Bertola will present their papers.
The final panel will provide an overview of labor markets and monetary policy. It will include Bank of England Deputy Governor Ben Broadbent, Bank of Japan Governor Haruhiko Kuroda and Brazilian central bank chief Alexandre Tombini.
* * *
The conference is lacking Wall Street participants for the first time.
An exception is Jacob Frenkel, chairman of JPMorgan Chase International, who is attending in his capacity of chairman of the board of trustees of the Group of 30, a private-sector group of mainly former policy makers which advises central banks and governments. Tim Adams, president of the Institute of International Finance, is also present.
Draghi, Kuroda and Bank of Canada Governor Stephen Poloz provide international central banking firepower.
Among academics in attendance are Alan Blinder of Princeton University, Harvard University’s Kenneth Rogoff and Martin Feldstein, and John Taylor of Stanford University. President Barack Obama’s administration is represented by Jason Furman, chairman of the Council of Economic Advisers and Jeffrey Zients, director of the National Economic Council.
* * *
The backdrop for the symposium and Yellen’s speech was set by the release of the minutes from the Federal Open Market Committee’s July discussions.
Fed officials in July raised the possibility they might raise rates sooner than anticipated, as they neared agreement on an exit strategy. Some participants were “increasingly uncomfortable” with the pledge to keep interest rates low for a “considerable period,” the minutes said.
At the same time, “many participants” still saw “a larger gap between current labor market conditions and those consistent with their assessments of normal levels of labor utilization.”
* * *
* * *
Some recent stories on the U.S. labor market:
* * *
The opening day of Jackson Hole has been associated with stock-market gains in each of the past seven years. The Standard & Poor’s 500 Index rose an average 1.3 percent on each of them from 2007 to 2012, following speeches by then-Chairman Ben S. Bernanke, who skipped last year’s conference.
The biggest climb was the 1.9 percent of 2009, when Bernanke said the economy appeared to be “leveling out.” Gains also followed his signals of 2010 and 2012 that fresh asset-purchases were imminent.
The bar is therefore set high for Yellen who identifies slack labor markets as a reason for easy monetary policy. Economist Ed Yardeni says the “Fairy Godmother of the Bull Market” won’t let us down.
Still, Steven Englander of Citigroup Inc. says that because “dovishness is increasingly anticipated,” Yellen may have to intensify her support for low interest rates if risk-assets such as stocks are to rally anew.
Source
‘If Texas votes how it looks, we win’: The grassroots effort behind Texas’ progressive movement
![](/sites/default/files/newsdefault.jpg)
‘If Texas votes how it looks, we win’: The grassroots effort behind Texas’ progressive movement
“What’s happening in Texas is arguably a phenomenon unique to the state, but it also has national implications. The kind of work Brown’s organization does for local communities can be replicated...
“What’s happening in Texas is arguably a phenomenon unique to the state, but it also has national implications. The kind of work Brown’s organization does for local communities can be replicated elsewhere, argued Asya Pikovsky, who works with the Center for Popular Democracy Action. “Groups like [TOP] are demonstrating how to win power in red and purple states: focus on city elections, lean into progressive principles, and mobilize voters who have long been marginalized by fielding candidates who can effect real change,” Pikovsky told ThinkProgress. “We should expect to see the same dynamic repeated over and over again this year as organizers find new ways to leverage local elections to win far-reaching national change.”
Read the full article here.
Fed Leaves Interest Rates Unchanged
WASHINGTON — One of the longest economic expansions in American history remains so fragile that the ...
WASHINGTON — One of the longest economic expansions in American history remains so fragile that the Federal Reserve said on Thursday it would postpone any retreat from its stimulus campaign.
Janet L. Yellen, the Fed’s chairwoman, described the decision as a close call and said the central bank still expected to raise interest rates later this year. The Fed has kept its benchmark interest rate close to zero since late 2008, when the nation’s economy was at the depths of crisis.
“The recovery from the Great Recession has advanced sufficiently far and domestic spending has been sufficiently robust that an argument can be made for a rise in interest rates at this time,” Ms. Yellen said at a news conference.
But, she said, “heightened uncertainties abroad,” including the Chinese economy’s weakness, had persuaded the bank to wait at least a few more weeks for fresh data that might “bolster its confidence” in continued growth.
The Fed’s decision, announced after a two-day meeting of its policy-making committee, had been widely expected by investors in recent weeks.
Fed officials spent most of the summer suggesting that they wanted to raise rates in September, only to lose confidence as signs of slowing global growth weighed on markets.
The 10-year Treasury note yield fell 0.11 percentage points to 2.189 percent. The Standard & Poor’s 500-stock index dropped 0.26 percent to 1,990.20.
There were signs, however, that the Fed might hesitate only briefly. It separately released economic projections showing 13 of the 17 officials on the Federal Open Market Committee still expected to raise the benchmark rate this year.
The Fed has said it is moving toward raising rates because it expects economic growth to continue, reducing unemployment and eventually raising inflation; on Thursday, Ms. Yellen said that outlook had not changed.
“There’s a tendency among some to think that they’re always going to get cold feet, and I thought Yellen really as much as possible discouraged that kind of thinking,” said John L. Bellows, a portfolio manager at Western Asset Management.
The policy-making committee still has scheduled meetings in October and December, and Ms. Yellen said a rate increase was possible at either meeting.
One official, Jeffrey M. Lacker, president of the Federal Reserve Bank of Richmond, in Virginia, voted to raise rates at the September meeting, the first dissent this year. The economic projections suggest that Ms. Yellen faces more disagreements at the Fed’s October meeting, given that six officials predicted the Fed would raise rates at least two times this year, while four said that they expected no increases.
The latest postponement was welcomed by liberal activists and economists who argue that the recovery remains incomplete. Representative John Conyers Jr., Democrat of Michigan, introduced legislation on Thursday directing the Fed to push the unemployment rate below 4 percent. While the bill has no chance of winning approval in the Republican-controlled Congress, Mr. Conyers addressed a rally organized by the Center for Popular Democracy outside an office building where Ms. Yellen spoke, joining in a chant of “Don’t raise interest rates.”
Critics expressed concern that the Fed has adopted increasingly ambitious goals for its stimulus campaign. “There is always a reason to chicken out,” said Dean Croushore, a professor of economics at the University of Richmond. “The Fed will lose credibility over time, as it fails to follow its own prior announcements about when it will increase rates.”
Ms. Yellen, asked about the efforts to put public pressure on the Fed, which have mounted in recent months, dryly observed, “We have been receiving advice from a large number of economists and interested groups.”
She denied that outside pressure had influenced the Fed’s decision. She also said it had not been influenced by concerns about a potential government shutdown, which could disrupt growth, though she said that it “would be more than unfortunate.”
The Fed’s decision is probably a “mixed blessing” for the global economy,” Eswar S. Prasad, an economics professor at Cornell, said in an email. Instead of new pressures, investors must deal with continued uncertainty.
A Fed increase, for example, might have prompted investors to pull money out of countries like Turkey or Brazil, damaging their economies, and reduced demand for imports from Europe and other developed countries. But the decision to stand pat also could weigh on Europe in the short term if it causes the euro to rise against the dollar, making things harder for exporters.
The American economy is outpacing the rest of the world, and Ms. Yellen said on Thursday that the Fed did not yet see evidence that growth was slowing.
Fed officials say they believe that labor market conditions have nearly returned to normal. In the new round of economic projections, officials estimated unemployment would stabilize next year at 4.8 percent, just below the August level of 5.1 percent.
Officials also remain confident that inflation will rebound, although perhaps a little slowly because of the recent downturn in the prices of oil and other commodities. Since the financial crisis, inflation has remained consistently below the central bank’s 2 percent annual target, lately rising just 0.3 percent over the previous year.
Fed officials argue that a tighter labor market will lead to higher inflation as employers are finally prodded to pay higher wages. But, Ms. Yellen said on Thursday, that will happen more slowly than the unemployment rate might suggest, because people not counted among the unemployed — like those who have stopped looking for work or have taken part-time jobs — may start looking again as conditions improve.
James A. Wilcox, an economist at the University of California, Berkeley, said that it was difficult to find evidence for a strong connection between inflation and employment, particularly over the last decade. Inflation fell less than expected during the recession, and it has increased less than expected in the aftermath.
“The events of the last 10 years have caused a lot of rethinking and stomach acid within the Federal Reserve and the research community,” Dr. Wilcox said.
Recent history has reinforced the more basic point that it takes a lot to change the underlying pace of inflation. That stability has allowed the Fed to press its stimulus campaign, but Dr. Wilcox said it also provided a good reason for the Fed to be wary of allowing inflation to climb, because reversing the trend could be very painful.
“If the heat builds slowly, and it can only be turned down slowly, then you have to move ahead of time,” he said. “That’s why there’s sympathy for the idea of starting to raise rates relatively soon.”
Given the weakness of economic growth, however, Ms. Yellen reiterated on Thursday that the Fed planned to raise rates more slowly than its past practice. Fed officials expect the benchmark rate to reach 2.6 percent by the end of 2017.
In June, they predicted the rate would reach 2.9 percent. Officials also expect the rate to reach a new plateau of about 3.5 percent, less than the June prediction of 3.8 percent and significantly below the level once regarded as normal. Such a low plateau would limit the Fed’s ability to respond to economic downturns.
The Fed has already held its benchmark rate near zero much longer than it once expected. It announced in 2012 that it would keep rates near zero at least until the unemployment rate fell below 6.5 percent. That threshold was crossed in April 2014.
Last winter, when the Fed ended its bond-buying campaign, officials pointed to June as the most likely moment for “liftoff” from the so-called zero bound.
Some officials have made clear they are not inclined to wait much longer.
Stanley Fischer, vice chairman of the Federal Reserve, warned in late August that officials would not be able to postpone a decision until all doubts were resolved. “When the case is overwhelming,” he said, “if you wait that long, then you’ve waited too long.”
Ms. Yellen echoed that warning on Thursday. “We don’t want to wait until we’ve fully met both of our objectives to tighten monetary policy,” she said.
The Fed’s hesitation on Thursday echoed events of two years ago, when investors expected the central bank to announce at its September 2013 meeting that it was tapering its bond purchases. The Fed demurred, citing uncertainty about economic conditions.
Instead of September, it acted in December.
Source: New York Times
Hillary Clinton Embraces Progressive Federal Reserve Reforms
![](/sites/default/files/newsdefault.jpg)
Hillary Clinton Embraces Progressive Federal Reserve Reforms
Democratic hopeful Hillary Clinton came out in favor of changes to the Federal Reserve that would reduce the number of bankers in key central bank positions on Thursday, marking a major coup for...
Democratic hopeful Hillary Clinton came out in favor of changes to the Federal Reserve that would reduce the number of bankers in key central bank positions on Thursday, marking a major coup for national progressive groups championing reform.
“The Federal Reserve is a vital institution for our economy and the wellbeing of our middle class, and the American people should have no doubt that the Fed is serving the public interest,” Jesse Ferguson, a Clinton campaign spokesman, said in a statement. “That’s why Secretary Clinton believes that the Fed needs to be more representative of America as a whole as well as that commonsense reforms — like getting bankers off the boards of regional Federal Reserve banks — are long overdue.”
The campaign also provided insight into the type of Federal Reserve governors that Clinton would appoint.
“Secretary Clinton will also defend the Fed’s so-called dual mandate — the legal requirement that it focus on full employment as well as inflation — and will appoint Fed governors who share this commitment and who will carry out unwavering oversight of the financial industry,” Ferguson said.
The announcement brings the Democratic presidential front-runner closer to the position of her rival, Sen. Bernie Sanders (I-Vt.). Sanders proposed barring financial executives from sitting on the boards of the 12 regional Federal Reserve banks in an op-ed in The New York Times in December.
The Clinton campaign statement came in response to a letter to Fed chair Janet Yellen from 11 Democratic senators and 116 House Democrats. The letter, spearheaded by Rep. John Conyers (D-Mich.) and by Sen. Elizabeth Warren (D-Mass.), urged the Fed to appoint more women and people of different racial and ethnic backgrounds while expanding the representation of consumer and labor groups on regional Fed bank boards.
Currently, the vast majority of Fed bank board directors are white men. People representing either the financial industry or other major business sectors also occupy most of the seats.
It appears there is now widespread agreement among top Democrats that the Fed has to redouble its commitment to full employment and to be more attentive to how its policies affect African Americans, Hispanics, and other minorities.
Dean Baker, Center for Economic and Policy Research
The Fed’s control over monetary policy allows it to raise borrowing costs to head off inflation and reduce them to maximize employment. The members of Congress who wrote to Yellen argue that the disproportionate influence of financial officials and the lack of diversity at the Fed hamper its sensitivity to groups with a more precarious position in the job market.
Clinton had said virtually nothing about her agenda for the powerful central bank until now.
The Fed Up campaign, a coalition of progressive groups headed by the Center for Popular Democracy that has been at the forefront of recent efforts to make Federal Reserve reform a key part of the liberal agenda, confirmed that it has been in talks with the Clinton campaign for months.
“Secretary Clinton did the right thing today by coming out in favor of reforming the Federal Reserve,” said Ady Barkan, director of Fed Up. “We’re very excited that she listened to the voices of community leaders from around the country who have said that we need a Federal Reserve that reflects and represents the American people and that creates a strong economy for all.”
Some liberal economists previously noted that Clinton’s reticence about the Fed was inconsistent with her stated plans to return the country to the prosperity of the late 1990s, which enabled widespread wage growth. They argue that the era’s well-distributed economic gains were due in no small part to the permissive monetary policies of the Federal Reserve.
Dean Baker, one such economist and a co-director of the Center for Economic and Policy Research, was elated to hear about Clinton’s remarks.
“Holy shit — that’s great news,” Baker said in an email upon receiving the news.
“While Senators Sanders, Warren, and others on the left side of the party took the lead, it appears there is now widespread agreement among top Democrats that the Fed has to redouble its commitment to full employment and to be more attentive to how its policies affect African Americans, Hispanics, and other minorities,” Baker continued. “There is also agreement that the Fed’s current archaic structure needs to be changed.”
By Daniel Marans
Source
Activists jolt the Fed's mountain getaway
The shocking appearance of activists at the usually quiet retreat is a sign of a growing battle over when and whether the Fed should raise interest rates. That crucial decision is making the...
The shocking appearance of activists at the usually quiet retreat is a sign of a growing battle over when and whether the Fed should raise interest rates. That crucial decision is making the central bank even more of a political target for populist anger. With critics like Sens. Elizabeth Warren and Rand Paul taking sharper swipes at the Fed, protesters are becoming emboldened.
Both liberal and conservative critics of the bank have organized "counter conferences" on monetary policy held at the same time and place -- the first time in more than 30 years that anyone has scheduled events competing with the symposium hosted annually by the Kansas City Fed.
“The economy has not fully recovered and interest rates should not be raised when racial disparities exist,” said Shawn Sebastian, a policy advocate for the Fed Up Coalition of the Center for Popular Democracy, pointing to continued higher-than-average unemployment rates for black Americans.
And the crowded juxtaposition of the bankers and activists in a small resort area makes for some awkward encounters.
Sebastian spotted Richmond Fed President Jeffrey Lacker at the check-in desk at the Jackson Lodge this week and went right up to him.
“I gave him our agenda and invited him, personally, to come to our conference,” Sebastian said. “He handed the agenda back to me and said he had seen it and was, ‘well prepared for this kind of thing.'”
As Fed officials hear from central bankers from Switzerland and Chile Friday, they are doing so practically next door to a workshop called “Do Black Lives Matter to the Fed?” sponsored by Sebastian's group, which wants rates to stay low until wage growth and unemployment improve, especially for minorities. Meanwhile, a conservative group, the American Principle Project, is holding a separate conference several miles away that includes speakers pushing for tighter monetary policy and higher interest rates, as well a return to the gold standard.
The atmosphere is very different than when the Kansas City Fed started holding the retreat in Jackson Hole in 1982, back when fly-fishing enthusiast Paul Volcker was in charge of the central bank. The symposium has always been held in late August and billed as an exclusive, invitation-only affair in the middle of a national park. Over the years, it's grown to be one of the more high-profile Fed events, even being called the Davos for central banks.
The head of the Fed usually attends, although Chair Janet Yellen is skipping this year. The event tends to be covered by the media because, in past years, Fed chiefs like Ben Bernanke and Alan Greenspan have used the occasion to broadcast significant monetary-policy shifts.
The event is fairly cloaked in secrecy. Its dates weren't announced until early this spring.
“When I first started asking about it, back in November, they were very secretive. I had to go and ask the lodge what weekends were available and from that, I was able to determine the right weekend,” said Steve Lonegan, policy director for the American Principle Project, which was prohibited by lodge staff from holding a conference at the same place as the Fed symposium. His group is down the road at the Hotel Terra and Diamond Cross Ranch.
“I was told by the lodge staff that the Fed had the whole building, because of security purposes," he said.
A spokesman for the Kansas City Fed acknowledged this was the first year their symposium was taking place alongside competing monetary conferences. But he declined to comment further about the other groups.
Both organizations confirmed they’ve had opportunities over the past several months to sit down and talk about their top priorities face-to-face with Yellen.
But they said holding a conference at the same time as the Jackson Hole event seemed like the ideal way to get even more attention to their cause, with the added bonus that their own conference-goers might also run into central bank policymakers at the park. Both groups had invited Fed officials to their conference and hoped to get crossover attendees.
At one point this week, a group of about 100 Fed Up conference-goers outside the Jackson Hole Lodge chanted: “Don’t raise interest rates! Don’t raise interest rates!”
Meanwhile, central bankers flying into the Jackson Hole Airport -- basically the main entry to the area for conference-goers -- may have passed the American Principle Project's table advertising its event highlighting the problems of loose monetary policy.
“The goal of our conference is to challenge the Fed’s monetary policy and educate the American people on the widening income gap driven by the failed policies of the Federal Reserve system,” said Lonegan, whose conference includes speakers like Rep. Scott Garrett, a New Jersey Republican, and the outspoken broker and Euro Pacific Capital CEO Peter Schiff. Schiff’s session is called, “Monetary Roach Motel — No Exit from the Fed’s Stimulus.” There’s a panel on international monetary reform, which includes members of British Parliament, and a few speakers who want a return to the gold standard.
The APP had originally signed on former Fed chief Alan Greenspan as their main speaker. Greenspan pulled out, Lonegan said, so now former Sen. Jim DeMint, president of the Heritage Foundation, is the keynote speaker.
“It’s not easy to put together a counter conference to the most powerful organization on the planet earth,” Lonegan said. “You have to have speakers who have the guts to put their names out there.”
Source: Politico
20 hours ago
3 days ago