More action is needed from Congress and state and local governments to adequately address wealth and income inequalities, two Federal Reserve policymakers said on Monday.
The Fed is helping to raise awareness of racial disparities in income and wealth by bringing together businesses, nonprofits and banks to work on addressing inequality, New York Fed President John Williams said during a webcast discussion with lawmakers organized by the Congressional Black Caucus.
“What we really need is a really strong partnership where Congress and government at the federal state and local levels are doing their part on these issues… and we’re all working together,” Williams said.
Atlanta Fed President Raphael Bostic echoed those remarks and cited as an example that the Fed can offer loans but cannot provide grants to businesses or communities. “These are things much more institutional that we’re all going to have to address,” Bostic said.
The Fed issued new guidance at its meeting last week, stressing that interest rates will stay low until the U.S. economy is on track to reach its goal of 2% average inflation over time. The approach puts more emphasis on addressing shortfalls in employment, including gaps between Black and white workers and other demographics.
Bostic reiterated the Fed’s commitment to support all workers through the coronavirus economic crisis. “We’ve acted fast and we’ve acted boldly and we’re going to continue to be there,” Bostic said. “We’re not going to step away until everyone has gotten to a better place.”