JOHNSON STATEMENT ON MONETARY POLICY HEARING
February 27, 2014
WASHINGTON – Today, Senate Banking Committee Chairman Tim Johnson (D-SD) held a hearing on the Federal Reserve’s Semiannual Monetary Policy Report to Congress.
Below is Chairman Johnson’s statement as prepared for delivery:
“I call this hearing to order. We welcome Dr. Janet Yellen as Chair to deliver the Federal Reserve’s semiannual Monetary Policy Report. Chair Yellen, I would like to congratulate you on your nomination and confirmation. In fact, this month’s hearings are historic—the first time that a woman is delivering the Fed’s Semiannual Report to Congress.
“Chair Yellen, you have a lot of important issues to focus on as Chair, including continued implementation of Wall Street Reform, establishing policies to improve financial stability and reduce systemic risk, and providing appropriate monetary policy to support our economy. Overall, I am encouraged by the recent improvements in the economy. It appears that economic growth is picking up and many mainstream economists expect stronger growth this year. This is good news.
“However, I am concerned that the economic recovery is not being felt by every American. Too many cities and towns across America have not fully recovered from the Great Recession and continue to struggle. Long-term unemployment remains historically high and we see recent college graduates, many of whom are burdened by high student loan debt, have a tough time finding work. Income inequality is becoming more severe and more families are being squeezed out of the middle class. As such, and while inflation remains weak, I caution the Fed not to move too quickly to exit from its current policies until we are on solid footing and the recovery is more widespread.
“While the Fed’s policies have helped the recovery, the Fed can only do so much. Congress needs to act to ensure that the recovery is more widespread and that generations of Americans are not shut out of economic opportunity. We cannot solve our fiscal problems by imposing immediate and arbitrary cuts, and we need to invest in the economy today to ensure future prosperity. It is important we implement policies that work alongside monetary policy to help get more Americans back to work.
“Chair Yellen, I look forward to hearing your thoughts on the decision to taper asset purchases, how recent Fed actions are affecting the economy, and where the economy is heading.”