Average Americans must force the Federal Reserve to listen
Last week I went to an eye opening conference on the real state of America’s second economy. While former Texas Governor Rick Perry touted the Texas Miracle the stark reality tells a much different story.
The conference highlighted the role of the Federal Reserve in America’s economy. What was evident is that nineteen people (the 12 presidents of each Federal Reserve district and the 7 appointed board of governors) decide the fate of us all. While the President and the Senate ultimately choose the 7 governors, the Presidents of the 12 regional districts are selected by private corporations, banks, and ‘the public’. In practice America’s major corporations take preeminence.
As an example the Dallas Federal Reserve 9 Board of Directors are
- Christopher C. Doyle representing Texas First Bank
- Jimmy Rasmussen representing Hometown Bank N.A
- J. Russell Shannon representing National Bank of Andrews
- Curt Anastastio representing Nustar Energy LP
- Jorge A. Bermudez representing Byebrook Group
- Anne B. Stern representing Houston Endowment
- Renu Khator representing the University of Houston
- Matthew K. Rose representing BNSF Railway Company
- Greg L. Armstrong representing Plains All-America
Get the picture? Where is labor represented. Where is social welfare represented. These are the people that choose the president of the Dallas Federal Reserve who will have a large impact on the economy. These are likely people that never entered a barrio, a ghetto, or a failing community.
The current president of the Dallas Federal Reserve, Richard Fisher, is resigning in March. A search is on for his replacement. It is all done quietly. That is concerning because the Dallas Morning news reported
The Dallas Fed’s search committee is looking for someone with similar policy leanings as Fisher, who is a former investment banker, a person familiar with the search told Reuters.
Richard Fisher wants to raise interest rates inasmuch as inflation is negligible and many Americans are yet to see the unbalanced recovery. Middle-class and poor Texans want to have their say in selecting the new President of the Dallas Federal Reserve. They do not want a Richard Fisher clone who is devoid of awareness of what the average Texan and American are going through.
In the light the following open letter has been submitted for all to see.
Open Letter To The Federal Reserve of Dallas
Richard Fisher, President of the Federal Reserve Bank of Dallas
Janet Yellen, Chair of the Federal Reserve Board of Governors
Board of Directors of the Federal Reserve Bank of Dallas
Dear President Fisher, Chair Yellen, and members of the Board,
The Dallas Federal Reserve is a crucial policy-making institution for Dallas, Texas, and the entire Eleventh Federal Reserve District. The president of the bank has tremendous responsibilities both here, as a regulator of regional banks, and in Washington, D.C., as a member of the Open Market Committee that sets monetary policy for the entire country.
Recently, President Fisher announced his intention to step down in 2015. We are writing to you, on behalf of millions of families across the district, to highlight the need for the Federal Reserve to establish a transparent and public process for selecting President Fisher’s replacement.
Too many families continue to struggle through the lasting impacts of the economic crisis – particularly in low-income communities and communities of color. Income poverty and the prevalence of low-wage jobs remain higher in Texas than the rest of the country and asset poverty rates remain extremely high for households of color. Furthermore, the Dallas Fed has a key role to play in ensuring that banks in the diverse Eleventh District are not discriminating in the access to capital and are facilitating credit in Latino and African American communities for those seeking to own homes and to start businesses.
The next president of the Federal Reserve Bank will have a profound impact on the lives of millions of people living and working in the Eleventh District and across the nation. Yet those most affected by the Federal Reserve’s decisions have not been given the opportunity to participate in the process of choosing President Fisher’s successor. In fact, even the most basic facts about the process remain completely inaccessible to the public: we do not know when President Fisher will resign, who will choose his successor, or how that decision will be made. Even the name of the search firm hired to aid in the process has been kept secret, as has the membership of the “advisory group” that is involved in the process.3
This lack of transparency and democratic legitimacy is, unfortunately, not limited to the Dallas Fed or to the presidential selection process: members of the public currently have no opportunity to engage in a meaningful way in the Dallas Fed’s policy decision-making processes. The Board of Directors of the Dallas Fed is dominated by the executives of multi-billion dollar companies and banks and has no representation from community-based organizations, labor unions, or the faith community.
Given the importance of the position, and the continued economic struggles for families across the district, we believe that the selection of the next President of the Dallas Federal Reserve is too important to happen in secrecy.
We therefore are writing to ask that the Federal Reserve establish a transparent and inclusive process for selecting President Fisher’s replacement. Such a process should incorporate, at a minimum, public disclosure of the following:
- The schedule for the process, including the date of Richard Fisher’s resignation and the schedule of the interim steps in selecting his replacement;The names of Fed officials in Dallas and Washington, DC who will be responsible for making the decision, and their respective roles in the process;
- A set of criteria that will guide the selection process, including the credentials and experiences that the hiring committee is seeking;
- The names of candidates under consideration, published significantly prior to the final selection, so as to permit public input.
Moreover, we urge the Federal Reserve to establish real opportunities for meaningful public engagement in this process. Such engagement should include, for example:
- The opportunity for one or two members of the public to serve on the search committee;
- Mechanisms for members of the public to submit questions and receive answers from potential candidates;
- The use of public forums where the public can discuss issues of monetary policy and Federal Reserve governance with the search committee, candidates, and other Fed officials.
A process that permits genuine public input would facilitate civic engagement about the importance of the Federal Reserve, monetary policy and financial regulation, and macroeconomics more generally. It would be a valuable occasion for public education and would enhance the stature of the Fed as a leader in our community.
The families of the Eleventh District deserve to know when, how, and why the next President of the Dallas Federal Reserve bank will be chosen. We hope that the Fed takes the opportunity to establish a transparent, open, and inclusive process for making this important decision.
The members of:
Communication Workers of America District 6
Fe y Justicia Worker Center
Harris County AFL-CIO
North Texas Jobs with Justice
Service Employees International Union Texas
Texas Building and Construction Trades Council
Texas Organizing Project
Workers Defense Project
Working America – Texas