The Fed is pursuing aggressive rate hikes over ensuring employment---that’s driving unemployment and inequality

Will Daniel, “The 2022 economy is like a 4-engine airplane with only one that works—and most experts want to turn it off, top economist says,” Fortune, 8-27-22, https://fortune.com/2022/08/27/economy-four-engine-plane-inflation-employment-personal-consumption-william-spriggs/

“In essence, Powell is clearly stating that right now, fighting inflation is more important than supporting growth,” he said.

Rob Dent, a senior U.S. economist at the investment bank Nomura, told Fortune that the Fed is now shifting towards a period of keeping rates “higher for longer,” and will need to keep restrictive policies in place for a while in order to “ensure inflation does not become further entrenched” like it did in the 1970s and 80s.

Spriggs, on the other hand, argues that most Americans, and particularly those in communities of color, would probably prefer having a job, even with higher inflation, rather than being unemployed with low inflation.

“Whenever the Fed tries to argue, ‘See, Black people would be better off if their unemployment rate was higher, because then there’d be no inflation,’ what they miss is you don’t have a job. Inflation doesn’t mean anything if I can’t afford anything. So whatever inflation is, it’s irrelevant.”