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H.R. 7095 - Coretta Scott King Full Employment Federal Reserve Act of 2018

Sponsor: Ro Khanna (D)
Introduced: 2018-10-26
Bill Status: Referred to the House Committee on Financial Services.
 
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Full Text


115th CONGRESS
2d Session
H. R. 7095


    To amend the Federal Reserve Act to modify the goals of the Board of Governors of the Federal Reserve System, to eliminate class A and B directors from the board of directors of each Federal reserve bank, and to establish certain reporting requirements for the Board of Governors, and for other purposes.


IN THE HOUSE OF REPRESENTATIVES

October 26, 2018

    Mr. Khanna (for himself, Mr. Hastings, Ms. Clarke of New York, Ms. Wilson of Florida, Mr. Pocan, Ms. Norton, Mr. Ellison, Mr. Payne, and Ms. Schakowsky) introduced the following bill; which was referred to the Committee on Financial Services


A BILL

    To amend the Federal Reserve Act to modify the goals of the Board of Governors of the Federal Reserve System, to eliminate class A and B directors from the board of directors of each Federal reserve bank, and to establish certain reporting requirements for the Board of Governors, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title.

This Act may be cited as the “Coretta Scott King Full Employment Federal Reserve Act of 2018”.

SEC. 2. Modification of the goals of the Board of Governors of the Federal Reserve System and the Federal Open Market Committee.

Section 2A of the Federal Reserve Act (12 U.S.C. 225a) is amended—

(1) by striking “The Board of Governors” and inserting “(a) In general.—The Board of Governors shall”;

(2) by striking “stable prices” and inserting “a stable rate of inflation”; and

(3) by inserting at the end the following:

“(b) General policy: Congressional review.—In this section, the term ‘maximum employment’ means a labor market in the United States in which—

“(1) job seekers can find work;

“(2) involuntary part-time work is at a minimum;

“(3) median wages are rising with worker productivity; and

“(4) disparities in rates of unemployment and pay between and among racial, gender, urban, rural, and other demographic groups have reached their lowest practicable level.”.

SEC. 3. Promoting a diverse, representative Federal Reserve.

Section 4 of the Federal Reserve Act (38 Stat. 251) is amended—

(1) in the provision designated “Fifth” of the fourth undesignated paragraph, by inserting after “employees.” the following: “In making the appointment of a president, the bank shall interview at least one individual reflective of gender diversity, one individual reflective of racial or ethnic diversity, and one individual who has experience in scholarship or advocacy on behalf of the interests of consumers, labor, or other sectors of society whose interests are distinct from those of the banking and financial services sector. Not later than January 1 of each year, the bank shall submit a report describing the applicant pool demographics for the proceeding fiscal year to the Committee on Financial Services of the House of Representatives, the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Office of the Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau.”;

(2) in the ninth undesignated paragraph, by striking “, and divided into three classes, designated as classes A, B, and C”;

(3) by striking the tenth, eleventh, fourteenth, sixteenth, seventeenth, and eighteenth undesignated paragraphs;

(4) in the twelfth undesignated paragraph—

(A) by striking “Class C shall consist of three members who shall be designated by the Board of Governors of the Federal Reserve System.” and inserting “Members of the board of directors shall be designated by the Board of Governors of the Federal Reserve System.”; and

(B) by striking “class C”;

(5) in the fifteenth undesignated paragraph, by striking “of class C”;

(6) in the twentieth undesignated paragraph—

(A) by striking “Class C directors” and inserting “Directors”;

(B) by striking “of class C”; and

(C) by striking “the third class C director” and inserting “another director of the Board, designated by the Board of Governors of the Federal Reserve System,”; and

(7) in the twenty-fourth undesignated paragraph—

(A) by striking “of classes A, B and C, respectively,”;

(B) by striking “one” the first place it appears and inserting “three”;

(C) by striking “of each class whose term” the second place it appears and inserting “whose terms”;

(D) by striking “one whose term” the first place it appears and inserting “three whose terms”;

(E) by striking “one whose term” the second place it appears and inserting “three whose terms”; and

(F) by striking “in the several classes of ” and inserting “on the board of”.

SEC. 4. Studies.

Section 2B(b) of the Federal Reserve Act (12 U.S.C. 225b(b)) is amended—

(1) by striking “The Board shall” and inserting “(1) In general.—The Board shall”; and

(2) by inserting at the end the following:

“(2) INFLATION AND EMPLOYMENT FIGURES.—In each report required under paragraph (1), the Board shall include—

“(A) the results of a study of the past estimates of the Board on longer-run unemployment rates, including—

“(i) an assessment of the accuracy of such estimates;

“(ii) an assessment of the effect of such estimates on decisions of the Board; and

“(iii) recommendations of the Board to improve the accuracy of such estimates;

“(B) a study of the inflation target, including—

“(i) information on each measurement of inflation used to calculate such target;

“(ii) information on each period during which the Board determines that any such measurement is above or below such target; and

“(iii) a summary of the arguments for and against setting the inflation target at 2 percent inflation;

“(C) an estimate of the impact that the projected pathway for the Federal funds rate is likely to have on labor market conditions and on a variety of demographic groups, including demographic groups that experience unemployment rates above the national rate;

“(D) an assessment of whether alternative monetary policy approaches would affect such conditions and on such groups; and

“(E) a description of the confidence interval on each projection that the Federal Reserve System, or any participant in the Federal Open Market Committee, provides for the longer-run rate of unemployment.”.


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