Fed Bank Pres: US economic inequality threatens American Democracy [View All]

[Rose Siding]

Another Item on the Fed Worry List: Inequality
“There are signs that rising inequality is intensifying resistance to globalization, impairing social cohesion, and could, ultimately, undermine American democracy,” Janet Yellen, president of the Federal Reserve Bank of San Francisco, said in remarks prepared for delivery Monday night to the Center for the Study of Democracy at the University of California, Irvine.

“Inequality has risen to the point that it seems to me worthwhile for the U.S. to seriously consider taking the risk of making our economy more rewarding for more of the people,” she said. Although such questions aren’t part of the Fed’s legal mandate, both Fed Chairman Ben Bernanke and his predecessor, Alan Greenspan, also have publicly warned of the dangers that economic inequality poses to the U.S.

Before joining the San Francisco Fed, Ms. Yellen, a longtime economics professor at the University of California at Berkeley, did a stint as an economic adviser to President Clinton and a member of the Federal Reserve Board in Washington.

http://blogs.wsj.com/washwire/2006/11/07/another-item-on-the-fed-worry-list-inequality/