Whoa! Does the Fed Really Care About Jobs…Finally? Dig into this with Dean Baker

The most important political figure in your economic life—to be sure, the boss of a company has got a lot of power—is not the president of the United States, no matter who that is. It’s probably the head of the Federal Reserve Board. We know interest rates are at historic lows and mortgage rates are crazy low because the Fed has intervened to keep the country from collapsing even further into the abyss we are in, an abyss Republicans in Congress don’t seem to care about.

Which is why what the Fed Chairman Jerome Powell announced recently is pretty important—the Fed will keep its main attention on employment. Is this just a pandemic-linked shift that will eventually go away and send the Fed back to doing the bidding of the banks and the bond markets? I poke at this topic with my favorite Fed watcher, Dean Baker, senior economist with the Center for Economic and Policy Research.