What happened to the Federal Reserve’s inclusive employment goal?

If you’re a regular listener to this program, you’ve probably heard of the Federal Reserve’s dual mandate: price stability and maximum employment. But in the summer of 2020, the Fed made a little tweak. It added the words “broad-based” and “inclusive” to the employment part of the mandate, acknowledging the benefits a strong economy brings to low- and moderate-income communities. This is significant because for decades the Black unemployment rate has been double the rate for white workers in this country. So, the Fed started “running the economy hot” longer to try to close that gap. But the central bank has begun a campaign of raising interest rates to cool the economy because inflation is here. What now? On the show today, William Spriggs, a professor of economics at Howard University and chief economist at the AFL-CIO, explains why the Fed’s approach to closing the unemployment gap hasn’t worked and what can really be done to fix it. Then, the hosts will talk about the big story of the day: the draft Roe v. Wade decision and what overturning the 1973 ruling might mean for the health and economics of women, especially poor women, in this country. Here’s everything we talked about today: “The Fed wants to slow down the economy. It risks leaving Black workers behind” from Fortune “Interest rate hikes will hurt Black Americans the most” from Quartz “Atlanta Fed President Raphael Bostic: “Everything is just taking longer than I would have expected going in.” from Marketplace “Supreme Court has voted to overturn abortion rights, draft opinion shows” from Politico ICYMI: “Reproductive rights are economic rights” “Make Me Smart” episode with economist Caitlin Myers We’re looking for your answer to the Make Me Smart question: What is something you thought you knew that you later found out you were wrong about? Leave us a voice message at 508-827-6278 or 508-U-B-SMART or email us at [email protected].