Democrats in Congress are pushing the Federal Reserve to emphasize diversity when filling top policymaking roles.
In a new letter sent to Fed Chairwoman Janet Yellen, the lawmakers noted that the overwhelming majority of top central bank positions are filled by white men, and they urged a rapid change.
“The importance of ensuring that such positions are filled by persons that reflect and represent the interests of our diverse country cannot be overstated,” they wrote. “When the voices of women, African-Americans, Latinos, Asian Pacific Americans, and representatives of consumers and labor are excluded from key discussions, their interests are too often neglected.”
{mosads}The letter, spearheaded by Sen. Elizabeth Warren (Mass.) and Rep. John Conyers Jr. (Mich.), garnered signatures from 11 senators and 116 House Democrats. Sen. Bernie Sanders (I-Vt.), a Democratic presidential contender, signed the letter, as did every Democrat in the Congressional Black Caucus.
Hillary Clinton jumped into the fray as well, issuing a statement Thursday echoing that message and calling for reforms at the Fed to limit Wall Street input.
“Secretary Clinton believes that the Fed needs to be more representative of America as a whole as well as that commonsense reforms — like getting bankers off the boards of regional Federal Reserve banks — are long overdue,” said a campaign spokesperson.
The members called for the Fed to consider a range of factors when filling upcoming vacancies, including a candidate’s ethnicity, economic and professional background.
They note that while unemployment has fallen sharply over the last several months, minority groups still fall behind. White unemployment is 4.3 percent, Hispanic unemployment is 6.1 percent, and black unemployment is 8.8 percent.
The lawmakers noted that every member of the Federal Open Market Committee (FOMC), which sets the nation’s interest rate policy, is white.
In response to the lawmaker critique, the Fed said it was committing to boosting diversity, and touted its recent efforts along those lines.
“We have focused considerable attention in recent years on recruiting directors with diverse backgrounds and experiences,” said a Fed spokesperson. “By law, we consider the interests of agriculture, commerce, industry, services, labor, and consumers. We also are aiming to increase ethnic and gender diversity. “
Thursday’s letter is the latest in a growing leftward push to influence the Fed, as liberals view the central bank as disproportionately influenced by input from Wall Street. With the economy on the mend and the Fed eyeing upcoming interest rate increases, they argue that too many Americans lower on the economic scale are not yet feeling those economic gains and need more support from the central bank.
Yellen was previously asked about diversity at the Fed at a congressional hearing earlier this year, and she committed to look into the matter.
A top priority for the lawmakers is ensuring increased diversity at the 12 regional Fed banks scattered across the country. Those banks occupy five rotating seats on the FOMC. But their boards are mostly filled by commercial banks, which directly back each institution.
Democrats have said for years that the arrangement ensures that the financial sector enjoys a prime seat in communicating with the Fed. Thursday’s letter noted that no regional bank head is black or Latino, and no African-American has ever helmed a regional Fed bank in the organization’s 100-year history.
This post updated at 2:13 pm and 3:18 pm.