CPD IN THE NEWS

More than 120 members of Congress say the Federal Reserve has a striking diversity problem similar to the one that hit Hollywood's Academy Awards the past two years, and it's harming the economic prospects of millions of Americans.

The lawmakers -- including Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.), as well as Reps. Maxine Waters (D-Los Angeles) and John Conyers (D-Mich.) -- wrote to Fed Chairwoman Janet L. Yellen on Thursday complaining about what they called "the disproportionately white and male" leadership at the nation's central bank.

"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," said the letter, signed by 116 House members and 11 Senators.

"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," said the lawmakers, who were all Democrats except for Sanders, an independent running for the party's presidential nomination.

The diverse group of House and Senate members praised Yellen, the first woman to lead the Fed, for her "strong leadership" and efforts to help raise wages while combatting economic inequality.

But they said the Fed had failed to fulfill its statutory obligation to “represent the public, without discrimination on the basis of race, creed, color, sex, or national origin" and called on Yellen "to take steps to promptly begin to remedy this issue."

All five members of the Fed Board of Governors are white and three are men.

All 10 voting members this year of the Federal Open Market Committee (FOMC), the monetary policy-setting body that includes Fed governors and a rotating set of regional Fed bank presidents, also are white and six are men, the letter said.

In addition, 11 of the 12 regional Fed bank presidents are white and 10 are men, with no African Americans or Latinos.

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.

— Letter from lawmakers to Federal Reserve Chairwoman Janet L. Yellen

Regional presidents are appointed by the directors of each Fed bank. The Fed's Board of Governors in Washington approves the appointments.

In addition, the lawmakers cited a recent study by the Center for Popular Democracy, a worker advocacy group, that said that 39% of all regional Fed bank directors came from financial institutions, while 11% were from community, labor or academic organizations.

Fed spokesman David Skidmore said the central bank was "committed to fostering diversity -- by race, ethnicity, gender, and professional background -- within its leadership ranks."

The Fed's board has "focused considerable attention in recent years" on recruiting regional bank directors "with diverse backgrounds and experiences," he said.

Minority representation on the boards of Fed banks and branches increased to 24% this year from 16% in 2010, he said. And the proportion of women directors increased to 30% of the total from 23% during that period.

In a blog post in January, the former president of the Federal Reserve Bank of Minneapolis, Narayana Kocherlakota, raised concerns about diversity on the committee that sets monetary policy.

“There is one key source of economic difference in American life that is likely under-emphasized in FOMC deliberations: race,” he said.

Kocherlakota reviewed committee transcripts from 2010, the most recent available, and said he found no references at meetings "to labor market conditions among African Americans,” even though their unemployment rate never dropped below 15.5% that year.

The lawmakers cited Kocherlakota's post, calling it "unacceptable that discussion of the job market for these populations would be an afterthought, or worse, ignored entirely, and we are concerned that the lack of balanced representation may be a significant cause of this oversight."

Rep. David Scott (D-Ga.), who signed the letter, pressed Yellen at a House hearing in February to consider "getting an African American, for the first time in history, to be a regional president of a Federal Reserve bank."

Yellen said she "absolutely" would and regretted there hadn't been such an appointment.

"It's our job to make sure that every search for those jobs assembles a broad and diverse group of candidates," Yellen said.

The lawmakers said they appreciated her concern about diversity but urged her to do more.

Connie Razza, author of the Center for Popular Democracy report, said the large number of lawmakers who signed the letter showed that support is growing for changes at the Fed to make sure "the economy works for all."

The center coordinates Fed Up, a coalition of labor, community and liberal activist groups that has organized protests outside FOMC meetings urging central bank policymakers not to raise a key interest rate until the job market is stronger.

By Jim Puzzanghera

Source

“This is a victory for the working families who stepped up with innovative organizing to send the Fed a clear message: Our voices belong in the debate about our economy,” said Ady Barkan, Campaign Director for Fed Up. “With the recovery still far too weak in too many communities, it would have been economically devastating – and immoral – to slow the economy.”

“We applaud Chair Yellen and the Federal Reserve for resisting the pressure being put on them to intentionally slow down the economy. Weak wage growth proves that the labor market is still very far from full employment. And with inflation still below the Fed’s already low target, there is simply no reason to raise interest rates anytime soon. Across America, working families know that the economy still has not recovered. We hope that the Fed continues to look at the data and refrain from any rate hikes until we reach genuine full employment for all, particularly for the Black and Latino communities who are being left behind in this so-called recovery. 

The campaign held a rally outside the building where Chair Janet Yellen made the announcement this afternoon. Fifty workers gathered to tell their stories and call on the Fed not to intentionally slow down the economy. They were joined by Rep. John Conyers (D-MI), who introduced today the Full Employment Federal Reserve Act of 2015, which would enhance the Fed’s full employment mandate.

Throughout late 2014 and 2015, the Fed Up campaign has elevated the voices of working families, meeting with four of the five Fed Governors and six of the twelve regional Fed presidents. Workers across the country have talked about the tremendous racial and economic disparities that still afflict the economy, and the need for genuine full employment that creates rising wages and more jobs for all communities. It has enlisted the support of economists like Nobel Laureate Joe Stiglitz, the involvement of four of the nation’s largest progressive digital advocacy organizations, and over 120,000 supporters around the country.

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The Center for Popular Democracy promotes equity, opportunity, and a dynamic democracy in partnership with innovative base-building organizations, organizing networks and alliances, and progressive unions across the country. CPD builds the strength and capacity of democratic organizations to envision and advance a pro-worker, pro-immigrant, racial justice agenda.

Alyssa Milano and Ady Barkan attend the Los Angeles Supports a Dream Act Now! protest on Wednesday.

See the picture here.

American Banker - April 9, 2015, by Kevin Wack - The nation's largest banks are again under attack — this time over how they treat their own rank-and-file employees. 

A coalition called the Committee for Better Banks, which includes unions and community groups, is planning protests Monday outside big-bank offices in Minneapolis and St. Paul, Minn.  The organizers are marrying long-standing complaints about the impact of bank practices in low-income neighborhoods and the large salaries of top executives with newer gripes about the banks' treatment of their own tellers and sales representatives.  The central message is that the country's biggest banks should be paying higher wages, offering better benefits, and eliminating aggressive sales goals that can create stress for lower-pay employees.  "While the financial industry has recovered in a big way since the crash — it's really come back strong — frontline workers have not experienced that," said Aditi Sen, a research analyst at the Center for Popular Democracy, an advocacy organization that released a report Thursday in connection with the upcoming protests.

In May 2014, the annual mean wage for tellers at depository institutions was $26,720, or $12.84 per hour, according to the Bureau of Labor Statistics.

It's not clear whether the upcoming protests will include a substantial number of bank employees. Erin Mahoney, a spokeswoman for the coalition, said in an email that "thousands of bank workers have been engaging with us" using petitions and other methods.

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