by Ady Barkan
The weeks leading up to Carl’s birth had been serene and contemplative for Rachael and me. We had each pushed to finish various work projects by her thirty-eighth week so that we would be ready for an early arrival. But our little man bided his time until the forty-second week, which meant we spent all of May trying various old wives’ tricks—leisurely walks, spicy dinners, loving sex—to coax him out. Rachael was incredibly uncomfortable, but we both tried to cherish those days, filled as they were with quiet anticipation and the knowledge that everything would be very different very soon. When the time came, we took one final walk, one mile from our home to the hospital.
The first months of Carl’s life were like a fairy tale (though with a bit less sleep for Rachael than she would have liked), aided by our employers’ humane paid-family-leave policies, our supportive families, and Carl’s generous appetite. We quickly mastered the four-S’s system for soothing: swaddle him, sway him on his side, shush in his ear, and give him a pacifier to suck. I swaddled my little burrito very tightly, swayed emphatically, and shushed with all my might, and Rachael happily assented to my claim of soother in chief. We shared the premonition that I might end up being the “fun” parent because I had the sense of humor of a four-year-old boy—or maybe an eleven-year-old on my mature days. Rachael was profoundly satisfied with our lives: her first book was on track for publication with a prominent press (and tenure would follow soon thereafter), her baby boy was healthy and happy, and she had a partner who would be a dedicated, involved father—something she had never had herself.
About a month after Carl was born, I resumed working from home and held him in my arms as I joined my first conference call from our sunny back deck. It really was the perfect work-life balance. The perfect life.
As the plane gained altitude, I inserted my earbuds and clicked “play” on Phosphorescent’s Muchacho. The album’s soaring hymnal celebration matched my mood and my moment. I had climbed to a new vista. An expanse of new adventures and obstacles and pleasures and accomplishments spread out before me. I was the author of my own story, and it was going so well.
Later that day, as we pulled into the Jackson Lake Lodge for the third year in a row, my campaign deputy, Shawn Sebastian, and I were relaxed and confident. I’d like to think it was something like what defending champions feel warming up for the first game of the playoffs. We knew the court intimately (we’d held about three dozen press conferences and meetings with Fed officials since 2014) as well as the referees (we had a good relationship with nearly every reporter who would be at the event); our opponents had already agreed to play by our rules (Shawn was going to moderate the meeting with Fed officials, so we could tailor precisely all the topics of discussion); our team was well prepped and our game plan tight; and with the New York Times story in our back pocket, we were already up 10 points.
The “First Amendment space” just outside the lodge’s entrance was our home court, the only place on these federal lands where we could lawfully make noise or hand out literature. There, the campaign’s field manager, Rubén Lucio, was coordinating a team of people to put together the frames and brace for a beautiful fifteen-by-fifteen-foot forest-green banner that would tower over our proceedings. It would provide the backdrop for our photo op, a gut punch that fused our messages on economic and racial justice: “Full Employment for Black + Brown.” As Martin Luther King Jr. said just before his death, when he was organizing the Poor People’s Campaign to fight for full employment: “If a man doesn’t have a job or an income, he has neither life nor liberty nor the possibility for the pursuit of happiness. He merely exists.”
Like cheery barn raisers ready to build a new and more just world, Rubén’s team hoisted the banner behind our podium. CNBC, Fox Business, and two other outlets had set up their TV cameras; reporters were milling around with their notebooks, ready for the show to start. Meanwhile, our motley crew of 120 low-wage workers, students, retirees, economists, and professional organizers gathered around, wearing our patented bright green T-shirts. This year our two messages were meant to lay the groundwork for pushing reform legislation through the U.S. Congress in the new year and continuing to pressure the Fed to appoint someone other than white male bankers to leadership roles: “We Need a People’s Fed” and “Who Does the Fed Represent?” We looked good.
For the third year in a row, we had crashed the Fed’s exclusive and remote getaway. A bunch of low-wage people of color were inserting themselves into debates that, with a few exceptions, had for a hundred years been reserved for financiers and insulated bureaucrats. As they ricocheted off the walls of the Jackson Lake Lodge, our raucous cries of “This is what democracy looks like!” actually felt authentic and transformative.
Our press conference employed a central practice of community organizing: making sure that the people most impacted by public policy are the ones deciding what solutions to pursue and voicing demands. Like previous Fed Up events, this presser featured powerful personal testimony and argument from workers who deserved more than the American economy was currently offering them. Maria Rubio, a human rights lawyer and refugee from Honduras, spoke with ferocity about her inability to make ends meet as a cleaning lady in New York City and the Fed’s statutory and ethical duties to ameliorate the situation. And, because we also wanted to prove our policy chops, we had one of our campaign’s best economists, Josh Bivens from the Economic Policy Institute, explain why the U.S. economy was still not at full employment and why the Fed should continue keeping interest rates as low as possible. The cameras rolled and the reporters scribbled dutifully.
But the main event was still to follow. We wrapped up the press conference and filed into one of the large meeting rooms on the ground floor of Jackson Lake Lodge. The competition had moved onto the Fed’s home court, but we had all the momentum and knew that we were dramatically better prepared.
At a U-shaped table, ten members and staff from the campaign sat down with nine of the Fed’s seventeen most important decision-makers; the rest of our coalition sat in the audience fifteen feet away. TV cameras, reporters, and Fed staff were scattered around the room. We had prepared four questions for the Fed officials, each coming from a different powerful Fed Up leader—but these were long questions, three to five minutes each, filled with argumentation and evidence, and punctuated with the challenge that Fed officials justify the unjustifiable: Why should banks like Morgan Stanley be permitted to literally govern the Fed, even as it bails them out and enriches their CEOs? Why should 80 to 90 percent of the Fed’s policy and governance positions be occupied by white people and dominated by male bankers and CEOs, rather than a more diverse set of leaders from across the American economy and society? Why, in the face of inflation that was beneath its target and wage growth that remained stagnant, was the Fed intentionally trying to slow down the economy? And would the Fed commit to studying questions of inequality, racial discrimination, and full employment in order to show that its leaders cared about these issues? (This last one was a softball that had its intended effect: Minneapolis Fed president Neel Kashkari immediately agreed to our request, and has since then launched major public research initiatives on precisely these questions and become the most outspoken advocate at the Fed for genuine full employment.)
“Fed Faces Its Critics at Jackson Hole,” the Financial Times headlined its August 26, 2016, story on the event.
Policymakers Accused of Compromising Interests of Poorer Citizens in Rare Meeting with Activists
It was an event far removed from the esoteric academic debate that for decades has dominated gatherings of senior central bankers and academics at Jackson Lake Lodge.
On the eve of their annual symposium in Wyoming, Federal Reserve officials found their plans to tighten policy under assault from community activists, who accused them of compromising the interests of poorer citizens in a fight against an illusory threat of inflation.
In a meeting with the Fed Up coalition attended by eleven top US Fed officials on the
eve of the Jackson Hole symposium, central bankers insisted they had no desire to halt the recovery but that they needed to act to prevent risky imbalances from emerging down the road.
However, in a packed and occasionally heated gathering in a sweltering hotel meeting room in Grand Teton National Park on Thursday, community activists argued that the Fed’s leaders needed to better understand the plight of ethnic minority Americans on low wages.
Rod Adams, an organiser from the Neighborhoods Organizing for Change in Minneapolis, said that while the economy had recovered for white citizens, African-Americans and Latinos were still lagging behind with higher rates of joblessness.
“You will be leaving us behind,” he said, accusing the Fed of “pulling the ladder right up after you have climbed it.”
He added: ‘I don’t want to be sacrificed in your war against an inflation enemy that isn’t here.”
As the meeting ended and we started filing upstairs to enjoy the beautiful evening sun setting against the majestic Grand Teton Mountains, I ran into Binyamin Appelbaum, the New York Times reporter who had written the complimentary profile the previous day.
“What’d you think?” I asked him.
“I thought it was pretty incredible,” he said, explaining that reporters almost never get Fed officials to engage so extensively with criticisms of their policies. “Congrats.”
It had taken me nearly five years to earn those congratulations. The seeds of Fed Up had been planted in the fall of 2011, when I visited the encampment of Occupy Wall Street a few blocks away from the federal courthouse where I was working. The Occupy movement burst suddenly onto the American political scene, giving voice to the broad and profound dissatisfaction with the financial and corporate control of our economy and politics. And although it quickly dissipated in the cold of winter, the movement left a new consciousness and critique in the minds of millions of citizens and activists, including myself. The Wall Street financiers who had crashed the economy were made richer than ever before; the millions of families who had lost their homes and the workers who had lost their jobs were left impoverished and despondent. This was no way to run an economy or a society.
It was with that mind-set that, in the beginning of 2012, I read a series of blog posts and articles by Matthew Yglesias that would shape my thinking and my work for years to come. Yglesias argued that if progressives wanted to build a more equitable economy, we had to start paying serious attention to the Federal Reserve. This was the narrative—the worldview, really—that I internalized after digesting his arguments:
For large swaths of the American public, personal financial security has always been an unattained dream. How will I pay the rent next month? Is the new boss going to fire me? Will we ever be able to save enough for the kids’ college? These are the recurring fears for scores of millions of working and middle-class people, in addition to the millions more who live on the margins of society, unable to find any stable work.
This insecurity persists, despite America’s tremendous wealth, because of our gaping economic inequality and the absence of strong social welfare programs. For more than forty years, the fruits of the American economy have gone only to the richest in society; indeed, our public policies have taken money away from the 99 percent and shifted it to the CEOs and financiers who pay for the campaigns of the politicians who write those rules.
This story has gained increasing notice since the Great Recession, spurred by the mic checks of the Occupy movement, the colorful marches of the Fight for $15, and the bellicose clarity of Bernie Sanders’s presidential campaign. But it is an old story—as old as American capitalism itself. Who benefits from the sweat, diligence, and ingenuity of America’s workers? And who is left behind? These questions have dominated America’s politics and public discourse for two centuries, with only occasional breaks to focus abroad.
Scholars of American history and politics believe that the strength of the economy, more than any other factor—including the quality of the candidates—determines the outcome of our presidential elections. “It’s the economy, stupid” was the crystal clear slogan for Bill Clinton’s winning 1992 presidential campaign. And it summarizes so much of our shared political history: from the mass mobilizations of farmers and factory workers in the final decades of the nineteenth century through the enormous transformations of the New Deal, which aimed to bring shared prosperity to a society riven by despair, and into the retaliation of the Reagan Revolution, which again sought to entrench the power of the owners of capital. Indeed, America’s original sin and continuing crime—slavery and the oppression of black people—has always been about stealing and reappropriating the fruits of labor. And although our political discourse sometimes forgets it, the fight for women’s liberation is about more than abortion or birth control: it’s about whose labor gets compensated, and how fairly.
That much I knew already, but it was here that Yglesias opened my eyes: despite the central importance of the economy to our lives and society, since 1978 progressives have largely ignored the tremendous influence that the Federal Reserve wields over the shape of our economy. Although elected officials, journalists, and active members of civic society understand the centrality of economics to the welfare and happiness of the country’s residents, few of them understand the role of the Federal Reserve in setting that economic course, and even fewer think of the Fed as an important site for political struggle. Nobody considers the politics of abortion or affirmative action without thinking about the Supreme Court, but policy makers and commentators regularly forget about the Fed when they discuss economics.
For far too many political observers and participants, “the economy” is a mysterious creature shaped by forces outside of any decision-maker’s control: technology, complex global relationships, the whims of financial markets, and the sentiments of consumers all, in this story, determine whether we have “economic growth” or a recession, whether unemployment goes up or down, whether factories close or the price of the dollar goes up.
The reality, however, is that the economy is something built by humans. We set the rules that govern the relationships between workers and their bosses, between corporations and their competitors, between investors and start-ups and banks, between rich countries and poor, and within the financial markets. Although economics is by no means a science, the general course of our national macroeconomy is largely up to the decisions of policy makers. We can decide whether workers’ wages will go up or be stagnant, whether recessions will rob families of their homes or not, whether small businesses will be able to access loans or not, whether corporations will be able to monopolize an industry. And no entity has more power over these questions than the Federal Reserve.
In general, even those political actors who do think about the Fed treat it as a technocratic institution that makes expert decisions about how to build a strong economy. They rarely appreciate the fact that every day the Fed is making decisions that are fundamentally political—i.e., fundamental to the structure and shape of our body politic. Who has money, who can get it, and at what price? Who will be unemployed, who will find work, and at what wage? These questions are political, not just economic, because they address the most fundamental political question that any society faces: Who has power and who doesn’t?
The Fed is our nation’s central bank. It is a bank to the commercial banks, facilitating lending between banks and providing emergency loans so as to prevent runs on banks and the financial collapses that they can cause. (These powers were on vivid display during the financial crisis of 2008, when the Fed and the U.S. government bailed out various Wall Street firms—and did so, to the detriment of the public, without imposing major restraints on the banks’ ability to commit malfeasance again or providing restitution to the millions of people whose lives the banks had upended.) In its capacity as the nation’s central bank, the Fed sets the rate of interest that one bank must pay to another for short-term cash. This rate, called the federal funds rate, serve
s as the baseline for most other lending in the United States, including mortgage, car, student, and small business loans. That’s why the Fed’s interest-rate decisions are so important: they underlie the prices that we pay for many of the most important and expensive goods and services we rely on. And, consequently, they have an enormous impact on the course of the entire American economy.
This line of thinking struck a deep chord within me because it tied together my interests in economics and politics. I had enjoyed majoring in econ as an undergraduate, mainly because it allowed me to learn about the workings of the macroeconomy: how the taxation and spending choices of Congress could stimulate or stifle growth; how the Federal Reserve’s decisions about interest rates could impact global trade and the unemployment rate; how, in essence, and for better or for worse, the course of our economy could be set by politicians in Washington, D.C. Now I saw how my compatriots in the progressive movement had failed to recognize this important reality and that there were tremendous human costs to that oversight.
I also thought there was a chance I could do something to fix this problem. I was going to start a job in the fall at the Center for Popular Democracy, a brand-new advocacy and policy shop that would work with community-based organizations around the country to promote economic, immigrant, and racial justice. It was run by the type of people who would be open to innovative new campaigns and might enjoy launching an effort about Federal Reserve policy.
In September 2012, CPD held an open house in its quirky brownstone in Bushwick to celebrate its recent founding. I was scheduled to finish my clerkship and start working there a month later, and was eager to go celebrate with the progressive New Yorkers who would soon be my colleagues and comrades. Over beer and finger food, I mentioned the idea of a monetary policy advocacy campaign to Paul Sonn, who was a role model for the kind of advocate I hoped to become: he was a veteran lawyer and policy expert at the National Employment Law Project who had authored many of the most important minimum-wage and hour laws around the country over the past twenty years, and whom I had met during law school when I was working to draft a new living wage for New Haven. He started nodding his head and murmuring, “Yeah, I really like that . . . Uh-huh, uh-huh . . . That’s interesting.” And he started asking the kinds of smart, challenging questions that progressive activists around the country would ask me repeatedly over the next two years as I tried to get Fed Up off the ground: