CREDO members and our allies told the Federal Reserve not to raise interest rates, and we won.
Dear STJEPAN,
They got the message. In recent weeks, CREDO members like you pressured the Federal Reserve not to put the brakes on the economy by raising interest rates – and last week, the Fed announced it would leave rates unchanged.1
Nearly 70,000 CREDO members signed a petition to the Federal Reserve.2 In August, our friends at the Center for Popular Democracy delivered your signatures and those collected by a host of progressive allies directly to Federal Reserve leaders at a meeting in Jackson Hole, Wyoming.3 And in the final days before last week’s decision, CREDO members contributed to the wave of phone calls that overwhelmed the Fed’s phone system.4
There were a lot of factors that went into the Fed’s decision. But together with our friends in the progressive movement, CREDO members had an impact on the Federal Reserve board of governors. When decisions were being made Fed directors could not ignore the messages they were receiving from regular Americans that millions of workers are still looking for work and millions more have not seen their wages grow in years.
The Federal Reserve was under intense pressure to raise interest rates. Wall Street banks badly wanted an increase in rates in order to make more money off of loans.5Even though inflation remained below the Federal Reserve’s own target of 2%, some demanded that the Fed act to stem inflation by raising rates – even if it meant slowing down the economy as a whole. While mixed signals from recent economic data undoubtedly played a role in the Fed’s decision to leave rates where they are, we clearly helped counter the massive pressure the central bank was receiving from well-connected financiers.
When the economy is expanding rapidly and there are more jobs than there are people looking for work, wages increase. People who had given up hope of a job start applying again. And businesses start hiring and raising the pay for women, African-Americans, and others who are the last to get a job when times are tight. With the unemployment rate for African-Americans at 9.1%, far higher than the 5.1% rate for the general population, this is no time to raise interest rates.6
Wall Street may want higher interest rates, but the rest of us need as much economic growth as possible. Interest rates are only part of the story. We need to make sure that low rates actually benefit communities in need, and companies need to invest their savings in jobs – not boosting CEO pay. And because Wall Street will not stop pushing for higher rates, we need to remain vigilant and make sure the Federal Reserve acts in the future only when it is in the best interest of all Americans.
At the end of the day, our message to the Federal Reserve was simple: Wall Street has recovered, but Main Street has not. That message was heard, thanks to you.
Thank you for speaking out,
Murshed Zaheed, Deputy Political Director
- Patrick Gillespie and Heather Long, “No liftoff: Federal Reserve leaves rates near 0%,” CNN.com, September 17, 2015.
- CREDO Action, “Tell the Federal Reserve: Don’t Raise Interest Rates,”credoaction.com, retrieved September 20, 2015.
- Daniel Marans, “Fed Activists To Highlight Racial Justice At Jackson Hole Conference,” Huffington Post, August 24, 2015.
- Daniel Marans, “Rate Hike Opponents Overwhelmed The Fed's Phone System,” Huffington Post, September 16, 2015.
- Dakin Campbell, “Banks Want Higher Interest Rates,” Bloomberg, November 14, 2013.
- CNN Money, "U.S. unemployment rate hits 5.1%, lowest in 7 years," CNN.com, September 4, 2015.
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