Maybe Congress could help raise wages



March 5, 2019 - 10:17 AM

If U.S. companies needed more evidence that scrutiny of wages is intensifying, they heard it last week in Federal Reserve Chairman Jerome Powell’s testimony to Congress.

The subject came up several times. One memorable exchange was with Sen. Sherrod Brown, D-Ohio. He asked Powell whether the “Fed’s employment mandate is just to ensure that people are employed” or whether full employment implies something more, that “workers earn a salary and benefits that let them fully participate in the 2019 economy and our country.”

Powell dodged the question, instead reminding Brown that U.S. unemployment is at a 50-year low and that the Fed lacks the tools to “affect every social problem.” It’s true that the Fed’s mandate is to maximize employment, not wages, and that the Fed probably can’t raise wages, even if it wanted to.

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