By Karen Petrou
When we started this blog in 2017, we began with a plea for the Federal Reserve to factor inequality into its monetary and regulatory policy equation. We showed at the start, here, here and here, that the Fed’s focus only on averages and aggregates obscures sharp polarization at each end of the U.S. income and wealth distribution. It is these polarizations, as we’ve repeatedly seen in blog posts that undermine the Fed’s ability to set the U.S. economy on a forward trajectory of shared prosperity and stable growth – i.e., to meet its dual mandate as Congress expressly defined it in the Humphrey-Hawkins Act of 1978. The Fed is still resolutely crafting monetary policy with its eyes firmly averted from increasing inequality. Continue reading “The Missing Middle Class”
By Federal Financial Analytics
FedFin has just released a new policy paper laying out how emerging risks in unregulated tech-based financial products may threaten U.S. economic inequality. It’s not that regulated institutions have always done that much better, but rather that the power of big data, predictive modeling, and far-flung commercial interests combines with tech-firm culture in still more dangerous ways far outside the reach of effective controls or meaningful enforcement. Continue reading “Making “Responsible Innovation” a Reality: Big Tech, Small Money, and U.S. Economic Equality”
By Karen Petrou
On January 22, Rep. Carolyn Maloney (D-NY) and 18 senior House Democrats reintroduced legislation (now H.R. 707) requiring federal statisticians to provide an equality-focused insight into the gross domestic product (GDP) number all too often considered the arbiter of American prosperity. Senate Minority Leader Schumer (D-NY) and Sen. Martin Heinrich (D-NM) introduced the same bill last year and are sure to do it again and, then to join Maloney in pressing for action. This time, it will come quickly in the House and may well pass the Senate in this Congress. Would it make an equality difference? No, but at least we’d know more clearly how much trouble we’re in.
Continue reading “Gross Domestic Product and U.S. Inequality”
By Karen Shaw Petrou and Basil N. Petrou
Can a change in financial policy that speeds cures for blindness also cure the way disability now exacerbates U.S. economic inequality? Legislation introduced just yesterday shows how.
Like most severe disabilities, blindness and significant vision impairment are major causes of un- and under-employment. 72 percent of blind Americans are not employed on a full-time basis, which by definition almost always makes them among the most economically unequal of all Americans regardless of race, age, or region. To be sure, some blind people are gainfully employed – determination over the years and, now, technology and guide dogs drop the barriers to full achievement in almost every line of work and profession. But far too often, the problems in education that disadvantage all too many Americans are still worse for the disabled, as are perceptions about incapacity and even downright discrimination. Continue reading “Seeing One Way Out”
By Karen Shaw Petrou
When I spoke at the Federal Reserve Bank of New York on March 1, I pressed hard for less reliance on data that washes away growing U.S. economic-inequality gaps. Happily, many at the talk readily concurred. For those who disagree, take note: an amendment added on March 6 to a House Financial Services Committee budget statement for the first time demands that the Fed do better when it makes judgments about U.S. prosperity. Continue reading “One Small Step for Better Monetary-Policy Models”