Washington, D.C. – U.S. Senator Catherine Cortez Masto (D-Nev.) cosponsored legislation introduced by Senator Elizabeth Warren (D-Mass.) and Kirsten Gillibrand (D-N.Y.) to require the Federal Reserve to use its authorities to address racial inequality and disparities in economic outcomes. The Federal Reserve Racial and Economic Equality Act would require the Fed to consider racial disparities when making decisions and report on these disparities in its semi-annual reporting.
“As the coronavirus pandemic has exposed, the American economy continues to have shocking racial disparities, including in income, wealth, and access to credit. This bill requires the Federal Reserve to track the data that can help us understand how race affects the labor force, and it mandates that the Federal Reserve report on the actions it takes to reduce those inequalities.”
BACKGROUND:
The Federal Reserve Racial and Economic Equality Act would:
- Add a new section to the Federal Reserve Act that would require the Fed to carry out its functions in a way that “minimizes and eliminates racial disparities in employment, wages, wealth, and access to affordable credit;”
- Require the Federal Reserve Chair to identify in his or her semiannual testimony before Congress: (1) the existing disparities in employment, income and wealth across racial and ethnic groups and (2) how the Fed is using its authorities to reduce these disparities;
- Mandate that the Fed’s Semiannual Monetary Policy Report, released in conjunction with the Chair’s testimony, include recent labor force trends with “a comparison among different demographic groups, including race, gender, and educational attainment.”
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