Most people familiar with the Federal Reserve have heard of the bank’s “dual mandate” to balance unemployment and inflation, and maybe they are even familiar with its much-ignored requirement to maintain the stability of the currency.
Now, progressives in Congress and are pushing Joe Biden to fire current Fed chairman, Jerome Powell, so he can be replaced with someone who will refocus the Fed’s mission on “eliminating climate risk and advancing racial and economic justice.” If that were even possible, it would mean an end to Federal Reserve independence.
The new “woke” mandates are being pushed by Rep. Alexandria Ocasio-Cortez and Reps. Rashida Tlaib, D-Mich.; Ayanna Pressley, D-Mass.; Mondaire Jones, D-N.Y.; and Chuy Garcia, D-Ill. Mike Murphy reports in MarketWatch:
While acknowledging “positive changes” under Powell on efforts to reach full employment, the legislators said: “To move forward with a whole-of-government approach that eliminates climate risk while making our financial system safer, we need a chair who is committed to these objectives. We urge the Biden administration to use this opportunity to appoint a new Federal Reserve chair.”
“Under his leadership, the Federal Reserve has taken very little action to mitigate the risk climate change poses to our financial system,” they said of Powell. “At a time when the Intergovernmental Panel on Climate Change is warning of the potential catastrophic and irreversible damage inflicted by a changing climate, we need a leader at the helm that will take bold and decisive action to eliminate climate risk.”
The Democrats also decried moves by the Fed, under Powell, to reduce banking regulations put into place after the financial crisis. “Weakening financial regulations that were specifically created to prevent such a disaster from happening again risks the livelihoods of Americans across the country,” they said.
Powell is seen as having broad support from the White House and is expected to be nominated for another term. But a growing number of more liberal Democrats, including Sen. Elizabeth Warren, D-Mass., and Sen. Sherrod Brown, D-Ohio, have publicly criticized Powell recently.
Biden is expected to make a decision about Powell’s future this fall. The leading contender to replace him, if it comes to that, appears to be Fed governor Lael Brainard, the Wall Street Journal reported earlier this month.
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