Higher minimum wage means restaurants raise prices and fewer employee hours, survey finds

For restaurants, minimum wage hikes usually mean higher menu prices and fewer employee hours, according to a survey released Wednesday.

Fight For $15
Fast-food workers and supporters organized by the Service Employees International Union (SEIU) protest in front of a McDonald’s billboard in Los Angeles, in 2013.

The restaurant industry employs a large portion of minimum wage workers. It’s no surprise that 83% of survey respondents affected by minimum wage hikes reported that their labor costs rose at least 3%.

Twenty-three percent responded to minimum wage hikes by not making any changes to their business.

But the majority did. The most popular response — from 71% of operators — was to raise menu prices. Nearly half reworked their food and beverage options to reduce costs.

Some operators responded to the minimum wage increases by cutting costs, with 64% saying they reduced employee hours, and 43 percent saying they eliminated jobs.

Outside the restaurant industry, companies like Bank of America and Target have been hiking internal minimum wages to attract and retain employees in a tight labor market. Similarly, 87% of survey respondents affected by minimum wage hikes said that they increased wages for workers who made more than the minimum wage.

Continued: Higher minimum wage means restaurants raise prices and fewer employee hours, survey finds

The Science of the Job Search (Part 7: You Only Need 50% of Job “Requirements”

You’re as likely to get a job interview meeting 50% of job requirements as meeting 90% of them.
You’re as likely to get a job interview meeting 50% of job requirements as meeting 90% of them.

You’re as likely to get a job interview meeting 50% of job requirements as meeting 90% of them.

We were curious about how many job requirements are actually required, so we analyzed job postings and resumes for 6,000+ applications across 118 industries from our database of users. We found that while matching requirements is important, you don’t necessarily need to match all of them.

  • Your chances of getting an interview start to go up once you meet about 40% of job requirements.
  • You’re not any more likely to get an interview matching 90% of job requirements compared to matching just 50%.
  • For women, these numbers are about 10% lower i.e. women’s interview chances go up once they meet 30% of job requirements, and matching 40% of job requirements is as good as matching 90% for women.

You only need 50% of job requirements

You’re just as likely to get an interview matching 50% of requirements as matching 90%. We saw a clear upward trend in interview rates based on matching requirements, but with an upper bound. When users applied to jobs where they matched 40 – 50% of job requirements, they were 85% more likely to get an interview than when they matched less, and applying to jobs where they matched 50 – 60% of requirements made them an extra 192% more likely to get an interview over the 40 – 50% matches.

But after that point, you’re in diminishing returns. Applying to jobs where they matched 60% or more of job requirements didn’t provide any additional boost in interview rate.

Job Search Tip #1: Apply for jobs once you match 50% of job requirements.

For women, the % of requirements required is lower

You may have seen stories before about how women in particular don’t apply for jobs unless they’re 100% qualified. We wondered if they were on to something – maybe there’s gender discrimination at play and hiring managers look for women to meet more of the requirements. Turns out, our findings apply just as much to women as to men, and actually, for women, the chances of getting an interview start increasing as soon as you meet 30% of requirements.

Women get interviews at higher rates with fewer matched requirements – if only they applied to those jobs in the first place.
Women get interviews at higher rates with fewer matched requirements – if only they applied to those jobs in the first place.

Continued: The Science of the Job Search, Part VII: You Only Need 50% of Job “Requirements”

Why Columbus is more important than you realize

“Whether we love him or hate him, we should be aware that Columbus set in motion a series of interchanges that will affect us more than we’ll ever know…”

There is likely no public secular holiday more controversial than Columbus Day. Since the observance first began to be celebrated in the nineteenth century it has been opposed by a diverse rage of groups, from the Ku Klux Klan to the American Indian Movement to the National Council of Churches…

While we may downplay the individual achievements of Columbus, we should acknowledge he launched one of most significant events in the history of the world: the Columbian Exchange…

Article: Why Columbus is more important than you realize – Acton Institute

Sound Money Bill in Congress Would Define Dollar as Unit of Gold

$100 / 1 Ounce GoldThe legislation, H.R. 5404, would “define the dollar as a fixed weight of gold,” according to a summary posted at govtrack.us. Sponsored by Representative Alex Mooney (R-W.V.), the bill would order the Secretary of the Treasury to define the U.S. dollar as an amount of gold, based on that day’s closing market price, two and a half years after the measure is enacted. It would also order all Federal Reserve Banks to make Federal Reserve notes (dollars) exchangeable for gold at the statutory gold definition of the dollar. In short, you could trade the pieces of paper in your wallet for real money…

…at the state level, lawmakers and experts are hard at work in the effort to restore sound money. Numerous states have passed laws to facilitate commerce in gold and silver, with some states even defining the precious metals as legal tender. In Texas, state authorities are even working on a gold bullion depository to help sideline the Fed and expand the use of gold in trade. But for the American people to truly prosper, it is important for Congress to take action. After all, Congress created the problem by unleashing the Fed and its awesome powers over the lives of every American. It is time for lawmakers to do the right thing.’

Continue reading: Sound Money Bill in Congress Would Define Dollar as Unit of Gold (The New American)

Central banks manipulating & suppressing gold prices, says industry expert

© Leonhard Foeger / Reuters
© Leonhard Foeger / Reuters

Gold price suppression by the world’s central banks is a well-documented fact, according to Singapore’s BullionStar precious metals expert Ronan Manly. He explained to RT.com why that’s the case.

Central banks have a long and colorful history of manipulating the gold price. This manipulation has taken many shapes and forms over the years. It also shouldn’t be surprising that central banks intervene in the gold market given that they also intervene in all other financial markets. It would be naive to think that the gold market should be any different.

© Tamara Abdul Hadi

In fact, gold is a special case. Gold to central bankers is like the sun to vampires. They are terrified of it, yet in some ways they are in awe of it. Terrified since gold is an inflation barometer and an indicator of the relative strength of fiat currencies. The gold price influences interest rates and bond prices. But central bankers (who know their job) are also in awe of gold since they respect and understand gold’s value and power within the international monetary system and the importance of gold as a reserve asset.

So central banks are keenly aware of gold, they hold large quantities of it in their vaults as a store of value and as financial insurance, but they are also permanently on guard against allowing a fully free market for gold in which they would not have at least some form of influence over price direction and market sentiment.

The Bank for International Settlements (BIS) crops up frequently in gold price manipulation as the central coordination venue and the guiding hand behind a lot of the gold price suppression plans. This is true in all decades from the 1960s right the way through to the 2000s. If you want to know about central bank gold price manipulation, the BIS is a good place to start. Unfortunately the BIS is a law onto itself and does not answer to anyone, except its central banks members.

In the 1960s, central bank manipulation of the gold price was conducted in the public domain, predominantly through the London Gold Pool. This was in the era of a fixed official gold price of $35 an ounce. Here the US Treasury and a consortium of central banks from Western Europe explicitly kept the gold price near $35 an ounce, coordinating their operation from the Bank for International Settlements (BIS) in Basel, Switzerland, while using the Bank of England in London as a transaction agent. This price manipulation broke down in March 1968 when the US Treasury ran out of good delivery gold, which triggered the move to a “free market” gold price.

© Chromorange

Central banks continued to surpress gold prices in the 1970s both through efforts to demonetize gold and also dump physical gold into the market to dampen price action. These sales were unilateral e.g. US Treasury gold sales in 1975 and over 1978-1979, and also coordinated (and orchestrated by the US) e.g. IMF gold sales across 1976-1980.

Collusion to manipulate the price also went underground, for example in late 1979 and early 1980 when the gold price was rocketing higher, the same central banks from the London Gold Pool again met at the opaque BIS in Switzerland at the behest of the US Treasury and Federal Reserve in an attempt to launch a new and secretive Gold Pool to reign in the gold price. This was essentially a revival of the old gold pool, or Gold Pool 2.0.

These meetings, which are not very well known about, were of the G10 central bank governors, i.e. at the highest levels of world finance. All of the discussions are documented in black and white in the Bank of England archives and can be read on the BullionStar website.

The wording in these discussions is very revealing and show the contempt which central bankers feel about a freely functioning gold market.

Phrases used in these meetings include:

there is a need to break the psychology of the market” and “no question of any permanent stabilisation of the gold price, merely at a critical time holding it within a target area” and  “to stabilise the price within a moving band” and “it would be easy and nice for central banks to force the price down hard and quickly“.

And these meetings of top central bankers were in early 1980, 11 years after the London Gold Pool and 8 years after the US Treasury reneged on its commitment in August 1971 to convert foreign holdings of US dollars into gold.

Whether this new BIS gold pool was rolled out in the 1980s is open to debate, but it was discussed across the board for months by the Governors at the BIS, and may have been introduced in a form which would provide physical gold to the oil producers (gold for oil trades) without putting a rocket under the gold price. Their main worry was to allow the Middle Eastern oil producers to acquire some gold for oil without pushing the gold price up.

© Pavel Lisitsyn

The Bank of England was also involved in the 1980s in influencing prices in the London Gold Fix auctions, in what an ex Bank of England staffer described euphemistically as ‘helping the fixes’. And the Bank of England has even at times used terminology in the 1980s such as “smoothing operations” and “stabilisation operations” when referring to coordinated central bank efforts to control the gold price.

Probably two of the most influential changes on the gold market in the modern era are structural changes to the gold market which channel gold demand away from physical gold and into paper gold. These two changes were the introduction of unallocated accounts and fractionally backed gold holdings in the London Gold market from the 1980s onwards, and the introduction of gold futures trading in the US in January 1975.

In unallocated gold trading in the London OTC market, gold trades are cash-settled and there is rarely any physical delivery of gold. The trading positions are merely claims against bullion banks who don’t hold anywhere near the amount of gold to back up the claims. Unallocated bullion is therefore just a synthetic paper gold position that provides exposure to the gold price but doesn’t drive demand for physical gold.

When gold futures were launched in the US in January 1975, the primary reason for their introduction, according to a US State Department cable at the time, was to create an alternative to the physical market that would syphon off demand for gold, creating trading that would dwarf the physical market, and which would also ramp up volatility which in turn would deter investors from investing in physical gold. Gold futures are also fractionally backed and overwhelmingly cash-settled, and their trading volumes are astronomical multiples of actual delivery volumes.

Central banks as regulators of financial markets are therefore ultimately responsible for allowing the emergence of fractional reserve gold trading in London and New York. This trading undermines the demand for physical gold and allows the world gold price to be formed in these synthetic gold trading venues. Price discovery is not happening in physical gold markets. Its is happening in the London OTC (unallocated) and COMEX derivative markets. So this is also a form of gold price manipulation since the central banks know how these markets function, but they do nothing to crack down on what are essentially gold ponzi schemes.

© Ilya Naymushin

Imagine, for example, that central banks were as tough on paper gold as they seem to be now on crypto currency markets. Now imagine if central banks outlawed fractional gold trading or scare-mongered about it in the same way that they do about crypto currencies? What would happen is that the gold market participants would panic and unwind their paper positions, precipitating a disconnect between paper gold and physical gold markets. So by being lenient on the fractional structure of trading in the gold markets, central banks and their regulators are implicitly encouraging activities that have a dampening effect on the gold price.

The gold lending market, mostly centred in London, is another area in which central banks have the ability to cap the gold price. Here central banks transfer their physical gold holdings to bullion banks and this physical gold then enters the market. These transactions can either be in the form of gold loans or gold swaps. This extra supply of gold through the loans and swaps disturbs the existing supply demand balance, and so has a depressing effect on the gold price.

The gold lending market is totally opaque and secretive with no obligatory or voluntary reporting by either central bank lenders or bullion bank borrowers. The Bank of England has a major role in the gold lending market as the gold used in lending is almost all sourced from the central bank custody holding in the Bank of England’s vaults.

There is therefore zero informational efficiency in gold lending, and that’s the way the central banks like it. furthermore, freedom of information requests about gold lending are almost always shot down by central banks, even sometimes on ‘national security’ grounds.

Many central banks have lent out their gold long ago, and just hold a ‘gold receivable’ on their balance sheet, which is a claim against a bullion bank or bullion banks. These bullion banks roll over the liability to the central bank for years on end and the original gold is long gone. Since central bank gold is never independently audited, there is no independent confirmation of any of the gold that any central banks claim they have.

Gold receivables are another fiction that allows central banks to fly under the radar in the gold lending market, and central banks go to great lengths to make sure the market does not know the size and existence of outstanding gold lending and swapped gold positions.

In Febuary 1999, the BIS was again the nexus for secretive discussions about the gold market when a number of the large powerful central banks basically ordered the IMF to drop an accounting change that would have split out gold and gold receivables into two separate line items on central bank balance sheets and accounting statements. These discussions are documented in the IMF document which is available to see here.

This accounting change would have shone a light on to the scale of central bank gold lending around the world, information which would have moved gold prices far higher.

However, a group of the large central banks in Europe comprising the Bank of England, the Bundesbank, the Bank de France and the European Central Bank (ECB) applied pressure to torpedo this plan as they said that “information on gold loans and swaps was highly market sensitive” and that the IMF should “not require the separate disclosure of such information but should instead treat all monetary gold assets including gold on loan or subject to swap agreements, as a single data item.” 

© Leonhard Foeger

Central banks also at times sell large quantities of gold, such as the Swiss gold sales in the early the 2000s, and the Bank of England gold sales in the late 1990s.While the details of such gold sales are always shrouded in secrecy, and the motivations may be varied, such as bullion bank bailouts or redistribution of holdings to other central banks, the impact of these gold sales announcements usually has a negative impact on the gold price. So gold sales announcements are another tactic that central banks use to at times keep the pressure on the price.

There are many examples of central bankers discussing interventions in the gold market. In July 1998, former Federal Reserve chairman Alan Greenspan testified before the US Congress saying that “central banks stand ready to lease gold in increasing quantities should the price rise.

In June 2005, William R. White of the BIS in Switzerland, said that one of the aims of central bank cooperation was to “joint efforts to influence asset prices (especially gold and foreign exchange) in circumstances where this might be thought useful.

In 2008, the BIS at its headquarters in Switzerland even stated in a presentation to central bankers that one of the services it offers is interventions in the gold market.

In 2011, one of the gold traders from the BIS even stated on his LinkedIn profile that one of his responsibilities was managing the liquidity for interventions. After this was published, he quickly changed his LinkedIn profile.

Ronan Manly is a precious metals expert at BullionStar based in Singapore

Source: Central banks manipulating & suppressing gold prices – industry expert to RT — RT Business News

$21 trillion of unauthorized spending by US govt discovered by economics professor

From 16 Dec, 2017: “The US government may have misspent $21 trillion, a professor at Michigan State University has found. Papers supporting the study briefly went missing just as an audit was announced.”
$21 trillion of unauthorized spending by US govt discovered by economics professor
© Lee Jae Won © Reuters

The professor would not suggest whether the missing trillions went to some legitimate undisclosed projects, wasted or misappropriated, but believes his find indicates that there is something profoundly wrong with the budgeting process in the US federal government. Such lack of transparency goes against the due process of authorizing federal spending through the US Congress, he said.

Interestingly, in early December the authors of the research discovered that the links to key document they used, including the 2016 report, had been disabled. Days later the documents were reposted under different addresses, they say…”

Full story: $21 trillion of unauthorized spending by US govt discovered by economics professor — RT News

IRS took millions from innocent people due to how they managed their money

Wall St. Cash | Simon Dawson — BLOOMBERG
(Simon Dawson — BLOOMBERG)

’In most cases, the report found, agents followed a protocol of “seize first, ask questions later.” Agents only questioned individuals and business owners AFTER they had already seized their money…’

Continue reading:

“The Internal Revenue Service has seized millions of dollars in cash from individuals and businesses that obtained the money legally, according to a new Treasury Department inspector general’s report …

Simply depositing cash in sums of less than $10,000 was all that it took to arouse agents’ suspicions, leading to the eventual seizure and forfeiture of millions of dollars in cash from people not otherwise suspected of criminal activity …

The report found that in 91 percent of those cases, the individuals and business had obtained their money legally.”

Meals on Wheels: Donations Surge After Trump Budget

The public has already responded to President Donald #Trump’s America First budget plan. #MealsOnWheels’ average amount of daily donations increased by 50 times on Thursday after the White House proposed cuts to some of the program’s funding, a spokesperson for the group said, according to CNN…

Continued: Meals on Wheels: Donations Surge After Trump Budget


Related story: “President Trump’s first budget proposal to Congress last week specifically identified steep cuts to hundreds of domestic programs, but Meals on Wheels wasn’t one of them…” | Truth about Meals on Wheels in Trump’s budget President Trump’s first budget budget proposal to Congress last week…

Will Mnuchin stop Trump from auditing the Federal Reserve?

Auditing the Federal Reserve was once part of the Trump administration’s first 100 days’ action plan to “Make America Great Again,” but it appears that Wall Street banker and Treasury Secretary nominee Steve Mnuchin is now trying to undermine President Trump and the momentum of this important campaign promise.

Over the years, Sen. Rand Paul (R-Ky.) and Rep. Thomas Massie’s (R-Ky.) Federal Reserve Transparency Act has received growing bipartisan support, even from polar opposite ideologues like Sens. Bernie Sanders (I-Vt.) and Mike Lee (R-Utah), who recognize the dangers of allowing Fed officials to manipulate the economy for political gain.

In 2014, the bill passed the House with a 333-92 vote. Although it failed the Senate by a mere 7 votes, many speculate that the “Trump bump” will allow it to hop over the legislative hurdle once and for all — that is, unless Mnuchin distances the president away from it.

 

Although Trump recognizes that “Auditing the Fed is so important,” so much so that he publicly called out Sen. Ted Cruz (R-Texas) for missing a vote on the bill last year, Mnuchin is quietly working to stop the legislation from advancing. When questioned last week by Sen. Bill Nelson (R-Fla.), Mnuchin said, “As you know, the Federal Reserve is organized with sufficient independence to conduct monetary policy.”

Mnuchin is merely echoing his former Wall Street cohort’s talking points, and it’s important that we debunk them now before further damage is done to this important cause.

The Fed does not operate ‘independently’

The Federal Reserve has become nothing more than another arm of the executive branch, responding to the beck-and-calls of the president.

As economics scholar Robert Weintraub detailed, Fed policies almost always change to reflect the monetary views of the president.  For example, when he was head of the Fed, William McChesney Martin complied with President Eisenhower’s request for very slow growth in the money supply. Years later, however, Martin then agreed to reverse course by cranking up money growth to 5 percent for President Lyndon Johnson, who depended on massive Fed inflation to finance his “Great Society.”

The same held true under Fed Chairman Arthur Burns. A former vice president of the Dallas Fed said that, “The diary [Burns] kept during the Nixon years confirms that Fed policy became subservient to administration goals and the president’s re-election campaign.”

Things have not improved in recent years. In fact, this past election cycle, the “apolitical” employees of the Federal Reserve doled out over four times more in campaign donations to Hillary Clinton, who was widely speculated to win the presidency, than any of the other candidates combined.

So no, the Fed does not act independently — its members only do what is politically and personally convenient. Only a thorough Congressional audit can stop this cozy relationship between the president and the central bank.

The Fed is not thoroughly audited

Critics such as Mnuchin and Sen. Bob Corker (R-Tenn.) often argue that this bill is useless because the Fed is already thoroughly audited. This claim is far from the truth.

Currently, the Government Accountability Office, the independent, apolitical government agency tasked with auditing the Fed, is not allowed to touch the central bank’s monetary policy deliberations, FOMC transactions, and agreements with foreign central banks.

In a testimony to Congress, the GAO expressed how the audit in its current form is virtually futile because it does not allow them to adequately determine where our money is going. The Office stated, “We do not see how we can satisfactorily audit the Federal Reserve System without authority to examine the largest single category of financial transactions and assets that it has.”

In 2011, Congress ordered a limited, one-time GAO audit of Fed actions during the subprime crisis, and the results were far from pretty. That audit uncovered that the Fed lent out a whopping $16 trillion to domestic and foreign banks during the financial crisis without congressional approval.

What is the Fed doing today?

What assets has the Fed bought since then and who is it doling out money to now? The answer to these questions will remain unanswered unless Congress passes Paul and Massie’s Audit the Fed bill this session.

Allowing the Fed to rapidly inflate the money supply and secretly give out loans to foreign entities without congressional oversight is stupid policy. It has destroyed 95 percent of the dollar’s purchasing power, all for the purpose of helping the president and his favored Fed officials retain political power.

Let’s hope that President Trump, who has promised to “drain the swamp,” sees through the light of Mnuchin’s talking points and prioritizes the passage of this bill. The economy can’t be made “great again” without doing so.

Source: Will Mnuchin stop Trump from auditing the Federal Reserve?

Federal Reserve Bankers Mocked Unemployed Americans Behind Closed Doors

IN 2011, UNEMPLOYMENT WAS at a near crisis level. The jobless rate was stuck around 9 percent nationally, an unusually high number due to the continuing effects of the financial crash.

House Democrats were aghast. “With almost five unemployed Americans for every job opening, too many people remain jobless because of a lack of work, not a lack of wanting to work,” said Congressman Lloyd Doggett, D-Tex. So in early November 2011, they introduced a bill to reauthorize Federal unemployment benefits, an insurance program designed to aide those looking for work.

Behind closed doors at the Federal Reserve however, the conversation struck a different tone.

The Federal Reserve’s mandate is to promote “maximum employment,” which essentially means: print enough money so that everyone who wants one has a job. Yet according to transcripts released this month after the traditional five-year waiting period, Federal Reserve officials in November 2011 were debating whether unemployment was caused by bad work ethics and drug use – rather than by the greatest financial crisis in 80 years. This debate then factored into the argument over setting monetary policy.

“I frequently hear of jobs going unfilled because a large number of applicants have difficulty passing basic requirements like drug tests or simply demonstrating the requisite work ethic,” said Dennis Lockhart, a former Citibank executive who ran the Atlanta Federal Reserve Bank. “One contact in the staffing industry told us that during their pretesting process, a majority—actually, 60 percent of applicants—failed to answer ‘0’ to the question of how many days a week it’s acceptable to miss work.”

The room of central bankers then broke into laughter.

Charles Plosser, the president of the Philadelphia Federal Reserve, cited “work ethic” as a common complaint he heard in his district, both in rural and inner city areas. A contact of his who owned 60 McDonald’s restaurants said “passing drug tests, passing literacy tests, and work ethic are the primary problems he has in hiring people.”

His wife, he noted, had attended a meeting in Philadelphia where employers cited literacy, work ethic, and drugs as impediments to hiring.

It was hardly the first time these bankers blamed unemployment on the unemployed, rather than, say, bankers. In an April meeting that year, Richmond Federal Reserve President Jeff Lacker told participants that “Several firms told us of difficulty finding adequate workers, because they preferred to collect unemployment benefits or can’t pass drug tests.” He reiterated that point in November, saying that in West Virginia he was told by an employment agency that “unquestionably the biggest problem in hiring skilled and unskilled workers was the inability to pass a drug test.”

Lacker’s Federal Reserve district includes West Virginia. In August, he again spoke of “widespread reports about hard drug use, OxyContin and methamphetamine, in Appalachia and other rural parts of our District—in particular, Appalachia.”

Apparently his colleagues responded with laughter again, because he then said “Drug abuse and the hardship involved in unemployment aren’t really laughing matters.” Usage, he noted, isn’t higher than the national norm in West Virginia. “It’s hard to pin this down quantitatively,” he continued, wondering if there was “something meaningful there as a contributor to impediments to labor market functioning.”

These debates took place within the Federal Open Market Committee (FOMC), the Federal Reserve body tasked with “influenc[ing] the availability and cost of money and credit to help promote national economic goals.” The debate revealed a split within the Federal Reserve system between “hawks” who worry more about inflation than unemployment, and “doves” who believe that too many are going without jobs. Typically, “hawks” tend to lean to the right politically, and “doves” tend to lean slightly more to the left.

Lacker is one of the most “hawkish” members of the FOMC, which means he tends to be in favor of higher interest rates and higher unemployment to ward off inflation. In 2015, Lacker ascribed increasing inequality to the lack of college education among the poor

Sarah Bloom Raskin, a dovish member of the Board of Governors, countered by saying that unemployment was a function of the financial crisis. “The economy remains mired in the worst slump since that of the 1930s,” she said.

Daniel Tarullo, another dovish Federal Reserve governor appointed by President Obama, called the focus on drug use a “red herring.” He said, “We had that problem 25 years ago, 20 years ago, 10 years ago; we have it today; and we’re going to have it 5 years from now.” He cited housing debt from the largest housing bubble in history as a core driver of unemployment.

The transcripts illustrate how the controversial method of picking Federal Reserve officials plays out in setting monetary policy: The three men who cited work ethic or drug use as a cause of unemployment instead of the financial crash were picked by regional private sector businessmen to lead the local Reserve banks.

The Dodd-Frank financial reform law passed in 2010 mandated that the Federal Reserve Board in Washington approve the choices of private businessmen, but the Board has yet to reject any suggested candidates. The board members who cited the financial crash as causing unemployment were appointed by the president and confirmed by the Senate.

The concept of having private business interests selecting public officials has been criticized by experts. As Wharton professor and author of “The Power and Independence of the Federal Reserve” Peter Conti-Brown put it, “It’s not clear at all that the opaque and obscure process by which the private sector selects the Reserve Bank presidents produces superior central bankers than the public process used to select the remaining principal officers of the United States.” This controversial selection process risks having, as he put it, “a system for enhancing the influence of certain slices of society on our central banking policy.

Lacker and Lockhart are retiring this year. Advocates and experts are putting pressure on the Richmond Federal Reserve to replace retiring Reserve Bank Presidents with someone more attuned to the reality of unemployment. Fed Up, a coalition of advocates seeking to shift the Fed from its traditionally pro-bank policies, is seeking to have the regional bank President’s picked with more attention to the needs of workers.

Jordan Haedtler, deputy campaign manager of Fed Up, lashed out at Lacker’s comments as related in the newly released transcripts. “Even nine years into the recovery, workers are still struggling to get the wages and hours they need,” Haedtler said. “Yet with unemployment above double digits in huge swaths of President Lacker’s district in 2011, he was citing anecdotes about drug use and desire to collect unemployment benefits as key reasons why employers weren’t hiring. Rather than looking for solutions and talking to people who were out of work, he was seeking excuses from employers.”

President Donald Trump has a number of vacancies on the Federal Reserve Board to fill as well. He has been highly critical of Federal Reserve Chair Janet Yellen. He argued, without citing evidence, that she pursued monetary policy goals to help support Barack Obama and elect Hillary Clinton. If Yellen and Tarullo follow custom and step down from their board slots in 2018, Trump could appoint a majority of Federal Reserve board members within two years.

Despite the importance of monetary policy, the Federal Reserve keeps the transcripts of internal deliberations of the committee that sets monetary policy out of public view for at least five years. But the people who attend those meetings take other jobs — some in the financial services industry. In 2010, incoming House Oversight Committee Chairman Darrell Issa questioned whether it was appropriate for the Fed to withhold its deliberations for so long. “If the Fed’s full transcripts can be released sooner, they should be,” he said.

The debate in the Fed and within Congress was ultimately resolved. The Federal Reserve kept interest rates low. And in 2011, a new wave of recently elected Tea Party Republicans and Democrats finally compromised on language to cut unemployment benefits.

Neither West Virginia senator, Shelley Moore Capito nor Joe Manchin, would comment on Lacker’s discussion of the West Virginia drug epidemic and its relationship to unemployment. The Appalachia region, including West Virginia, went strongly for Trump in the 2016 election.

Source: Federal Reserve Bankers Mocked Unemployed Americans Behind Closed Doors