A U.S. central banker on Wednesday pledged to devote more resources to addressing economic disparities between black and white Americans, saying the high rate of unemployment among African Americans is “really troubling.”
“I do think some of the racial disparities are a crisis and we need to treat them like a crisis,” Neel Kashkari, chief of the Federal Reserve Bank of Minneapolis, said after meeting with members of the Minneapolis black community and Fed Up, a network of community organizations and labor unions calling for changes to the U.S. central bank.
Kashkari, a former Republican candidate for California governor, is the son of Indian immigrants and the only one of 17 Fed policy-makers nationwide who is not white.
Unemployment among black Americans, for example, is typically twice that for whites, Kashkari noted. Educational disparity may be one factor, but more research is needed to identify causes, he said.
“We need to understand the ‘why?’ before we can design potential solutions,” Kashkari said. “You don’t tackle a crisis with incremental solutions … We need to bring overwhelming force to try to address this.”
At the same time, Kashkari suggested the solutions are likely to go beyond the powers of the Fed, with lawmakers and local politicians likely in a better position to craft meaningful solutions.
The Fed, he said, has only the tool of interest rates at its disposal. As long as inflation remains low, he said, the Fed can keep rates low to boost job prospects for all Americans. But, he said, there is little the Fed can do to address structural problems in the economy besides contribute to research.
Regional Fed bank presidents often meet with members of their communities but only rarely are those meetings publicized.
Wednesday’s meeting and press conference afterward was livestreamed by Minnesota Neighborhoods Organizing for Change, which hosted the event at which several community members aired their experiences with low pay, long hours and homelessness.
Kashkari promised to spend a day with one of the participants to better understand the challenges she faces.
He also promised to meet with community activists again this month on the sidelines of an annual meeting of global central bankers in a national park near the well-heeled town of Jackson, Wyoming, and to collaborate on research.
“My job is to be your voice,” he said.