CPD IN THE NEWS

Federal Reserve Bank of Kansas City President Esther George will host a meeting Thursday with the activist group known as Fed Up ahead of the bank’s annual conference in Jackson Hole, Wyoming.

Other Fed officials also will attend the meeting, which will “focus on crucial and timely questions about monetary policy and Federal Reserve governance,” the group said in a statement. The meeting will be streamed online, the group said.

The Kansas City Fed confirmed the Aug. 25 meeting with the left-leaning Center for Popular Democracy’s Fed Up coalition.

Fed Up has been urging the central bank to hold off on raising interest rates until the economy improves further and working class households have seen more of the benefits of the expansion. The group also has criticized the Fed for lack of diversity among its 12 regional bank presidents.

The group has joined with Andrew Levin, a Dartmouth College professor and former Fed staffer, to propose changing the regional banks into fully government institutions from their quasi-public, quasi-private structure, and to eliminate regional board director seats that are reserved for bankers. The boards are responsible for appointing regional bank presidents who participate in the Fed’s policy meetings.

By David Harrison

Source

The predominantly white male composition of Federal Reserve leadership is facing criticism from Democratic elected officials who believe the institution doesn’t adequately reflect the demographics of the nation it is meant to serve.

The legislators said in a letter to Federal Reserve Chairwoman Janet Yellen on Thursday that central bank leaders also are drawn too frequently from business and financial backgrounds. The letter to Ms. Yellen received support from the leading Democratic candidate for the White House, Hillary Clinton.

Eleven senators and 116 members of the House of Representatives signed the letter, which was organized by Sen. Elizabeth Warren of Massachusetts and Rep. John Conyers Jr. of Michigan. No Republicans participated, although they were given the opportunity to do so.

“Given the critical linkage between monetary policy and the experiences of hardworking Americans, the importance of ensuring that such positions are filled by persons that reflect and represent the interests of our diverse country, cannot be understated,” the letter said. “When the voices of women, African-Americans, Latinos, and representatives of consumers and labor are excluded from key discussions, their interests are too often neglected.”

While the Fed has made “some progress” on diversity issues, the central bank has “considerable work to do” to comply with its legal mandate to represent the interests and diversity of the American people, the letter said.

The Fed said in a statement that it “is committed to fostering diversity—by race, ethnicity, gender, and professional background—within its leadership ranks.” It added that when it comes to the members of the regional boards, “by law, we consider the interests of agriculture, commerce, industry, services, labor, and consumers. We also are aiming to increase ethnic and gender diversity.”

The Fed also cited a rise in both racial and gender diversity on the regional Fed boards, with 46% of all directors now meeting the label of “diverse.”

In February, Ms. Yellen also addressed the issue in testimony to Congress, saying officials in Washington are “constantly attentive in its oversight of the reserve banks to the issue of diversity of representation on those boards. And it has improved considerably.”

The legislators’ letter follows a report earlier in the year from the Center for Popular Democracy’s left-leaning Fed Up Coalition, which took a look at the Washington-based Fed governors, regional bank presidents and boards of directors overseeing the 12 regional banks. That report flagged the fact that even as the Fed is now led by a woman, three of five current governors are men, and all are white. Of the 12 regional Fed bank presidents, 11 are white, two are women, and one is Indian-American. The last black person to hold a top leadership role at the Fed was Roger Ferguson, a vice chairman who left in 2006.

Fed governors are nominated by the president and are subject to Senate approval. Regional Fed bank presidents are nominated by their local boards by members representing firms not regulated by the central bank, subject to the approval of the Fed board in Washington.

The Clinton campaign said the central bank is indeed ripe for change. “The Fed needs to be more representative of America as a whole,” it said in a statement, adding that “commonsense reforms—like getting bankers off the boards of regional Federal Reserve banks—are long overdue.”

Much of the criticism over Fed diversity centers on the make-up of the regional bank boards of directors, which are populated by members of the private sector and oversee the operations of the Fed banks.

The makeup of Fed bank president ranks has been criticized for other reasons as well. The leaders of the New York, Philadelphia, Dallas and Minneapolis branches have all worked for investment bank Goldman Sachs in some capacity.

The Federal Reserve in recent years has faced criticism from both sides of the political spectrum. Many on the right have been angered by the central bank’s aggressive stimulus actions and its role in bailouts of the financial system, and some have wanted to audit the central bank’s process for making monetary policy and force the Fed to set policy based on an explicit and simple rule.

On the left, some have said the Fed has pursued policies that have promoted income inequality and the interests of the financial sector. The low level of diversity has become a more prominent concern in recent months in part because of the report from the Fed Up Coalition.

Meanwhile, former Minneapolis Fed President Narayana Kocherlakota said in a blog post in January that a lack of black representation at the Fed appears to have left central bankers insufficiently attuned to the economic troubles of the African-American community.

The Fed has become an issue in the presidential campaign. Last week, presumptive Republican nominee Donald Trump said he likely would replace Ms. Yellen if he were president. On the Democratic side, Sen. Bernie Sanders of Vermont has long been a critic of the Fed.

By MICHAEL S. DERBY

Source

Ms. Kniech was one of more than 50 local lawmakers in the United States who sent an open letter to Seattle leaders and residents on Monday supporting the tax and criticizing Amazon’s resistance to it. “By threatening Seattle over this tax, Amazon is sending a message to all of our cities: we play by our own rules,” the letter said.

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"I am a hurricane Maria survivor who now calls the state of Pennsylvania my home...Without support from the federal government, I am grateful for the assistance of grassroots organizations and nonprofits like CASA and CASA in Action, affiliates of the Center for Popular Democracy...I am now proud to work with CASA in action, canvassing and energizing voters. It is empowering to knock on doors and connect with other Latinos and long time residents who came to Pennsylvania before me. They understand that it is our duty as a community to come together and send a strong message that we are here and that we vote too."

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