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Waters to Powell: The Fed Must Use All of the Tools at Its Disposal to Ensure an Equitable and Swift Recovery

Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Committee on Financial Services, gave the following statement at a full Committee virtual hearing entitled, “Monetary Policy and the State of the Economy.”

Welcome back, Chair Powell. Since your last testimony before this Committee, the COVID-19 pandemic has continued to have a devastating impact all across the country.

Over 500,000 people in the United States have lost their lives to the virus, and there have now been 27.9 million U.S cases of the virus. The economy continues to be in a crisis. Millions of families are struggling to make rent or mortgage payments through no fault of their own. Roughly one-third of small businesses remain closed, and many more are at risk of permanently shutting their doors.

I am so glad that we now have President Biden providing leadership from the White House and a real plan to tackle this crisis once and for all. With Democrats now in control of the Senate, Congress can carry out that plan and provide the nation with the relief it so urgently needs.

This Committee has advanced legislation in our jurisdiction to implement President Biden’s American Rescue Plan and the full House will take up this legislation later this week. After gross, if not criminal, mismanagement of the crisis by the Trump Administration, Americans have shown that they want competent leadership and decisive action to crush this virus and put the economy on the road to recovery.

But even after Congress passes the American Rescue Plan, the country still needs the Federal Reserve to adapt, and to stand ready to use all of the tools at its disposal to ensure an equitable and swift recovery. It is long overdue for the Fed to reconsider its normal operating procedures and use its authorities to tackle the racial wage and employment gaps. The Fed must act vigilantly against ongoing signs of systemic stress, putting a stop to the deregulation that preceded this crisis. The Fed must continue to be attentive to inequality as it oversees this recovery, taking the impact on consumers and small businesses into account when considering mergers in the financial industry.

And the Fed must proceed with greater alacrity regarding climate risk in its supervision of financial institutions. The Fed has recently taken a few steps in this regard, but much more is needed to combat this systemic and existential threat.

I look forward to your testimony and to discussing these matters today.

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