Fed Reserve advisory board seeks “alternative” solutions to racial economic disparities

In recent years, the Minneapolis Federal Reserve Bank has worked to tackle unemployment rates among people of color –especially African Americans – and the historical reasons behind them. In 2017, it launched the Opportunity and Inclusive Growth Institute, a 19-member group of advisors composed of academic persons to analyze and make recommendations, with specific focus on increasing economic opportunity and inclusive growth for all Americans.

“We are … looking at things beyond what the Fed in the past traditionally has done,” said Mark Wright, Minneapolis Fed Director of Research in an MSR phone interview. The Institute, he pledged, has committed to look into the causes surrounding economic opportunity and inclusive growth.

“The Fed, for the longest time, treated maximum employment as a number – the unemployment rate,” Wright explained. “We were trying to get the unemployment rate down to a sustainable level. [But] behind that statistic are millions of lives and families.”

In April, the Fed formed a Community Advisory Board comprised of executives from multiple sectors, including government, nonprofit, finance and philanthropy, to support the Institute’s mission. The board’s charge is to “explain the barriers to economic opportunity and inclusive growth in local communities,” reported a recent Fed release statement.

Among its members are St. Paul Planning and Economic Development Director Bruce Corrie, State Employment and Economic Development Commissioner Shawntera Hardy and Gloria Perez, Jeremiah Program President and CEO. Additional members include Tawanna Black (Center for Economic Inclusion), Paul Fleissner (Redevelopment Authority, Olmsted County), Michael A. Goze (American Indian Community Development Corporation), Danielle Grant (AchieveMpls), Ezell Jones (CBIZ Inc.), Paul Mattessich (Wilder Research), Gregory P. Russ (Minnesota Public Housing Authority), Sondra Samuels, (Northside Achievement Zone), and Kate Wolford (McKnight Foundation).

Wright noted that North Minneapolis, in particular, has been historically beset with economic disparities, such as high unemployment. Both the Institute and the new advisory board hope to come up with “alternative ways” to examine these conditions and offer recommendations to create solutions, he said.

“The idea behind the Institute is that this is going to be a long-term commitment in dealing with these issues,” said the research director. “We don’t believe we are going to determine [a solution], write a report and be done with the issues any time soon.”

The Fed’s goal nonetheless is to go “deeper…and look at all the variables and factors throughout society and the economy that limits opportunity and inclusion, and the role they play in affecting what is maximum employment and how we can get there,” continued Wright. “We’re happy not to just inform the community through this group, but also have the community inform us to the kind of things they see on the grassroots level.”

While a regular meeting schedule has yet to be determined, Wright said meetings will be held in the community and not at the Fed offices. “We always had a willingness to engage with members in the community,” he said. “We can learn from the community on what matters. We will be working at this for a long time. We’re here to stay and not a short-term thing.”