Federal Reserve Chair Jerome Powell insists he won’t cause a deep recession but that “pain” is necessary to fight inflation.
By Ken Klippenstein, The Intercept
On Thursday, following reports that the Federal Reserve would likely soon jack up the federal interest rate again — this time by 0.75 percentage points — Chair Jerome Powell tried to allay fears that the Fed’s strategy would cause an economic downturn, insisting that another rate hike was unlikely to cause a deep recession.
The interest rate hikes, which nominally serve as a way for the Federal Reserve to tamp down inflation, are also a way to put economic power back in the hands of the very rich by driving up unemployment, since higher interest rates make it more expensive for banks to loan people money, leading to scarcer investment and therefore fewer jobs.
Powell downplayed the effect the Federal Reserve’s moves were likely to have on working people. “We think we can avoid the very high social costs that Paul Volcker and the Fed had to bring into play to get inflation back down,” Powell said, referring to the period in the 1980s when the Fed similarly hiked interest rates and engineered a recession.
Recent Posts
Biden Brags About Debt Deal While Progressives Shake Their Heads
Take Action Now “Here’s the news media’s takeaway on the debt ceiling deal: Yay! Bipartisanship works!…
American Jews Are More Ambivalent About Israel Than Ever
Take Action Now Grappling with a far-right government and growing awareness of the Nakba, American Jews revealed mixed feelings marking…
Weapons Manufacturers Are Overjoyed About The Debt Ceiling Deal
Take Action Now Lockheed Martin’s James Taiclet called the bill ‘as good an outcome as our industry or our company could ask for.’……
Police Arrest Organizers Behind Cop City Protester Bail Fund
Take Action Now “There is no First Amendment in Atlanta,” wrote activist Micah Herskind. By Sharo n Zhang, truthout Law enforcement officers in…