By Pedro Nicolaci da Costa
A group of conservative activists worried the Federal Reserve
has left interest rates too low for too long voiced their concerns
directly to Janet Yellen, the central bank's chairwoman, during a
meeting Friday.
Ms. Yellen met for about an hour in the Fed's policy meeting
room with a group of 21 right-leaning economists, activists and
businesspeople, said Steven Lonegan, director of monetary policy at
American Principles in Action, the conservative think tank in
Washington that spearheaded the meeting. Fed governor Lael Brainard
was also present, Mr. Lonegan said.
The Fed declined to comment.
The group's message: The Fed has kept its benchmark short-term
interest rate near zero for so long since December 2008 that the
policy is now having the unintended effect of dampening employment
rather than boosting it. The group said low rates encourage
companies to invest in equipment and structures rather than hire
more workers.
Marc Miles, economist at Global Economic Solutions in Boston and
a speaker in the meeting with Ms. Yellen, said in a statement
before the meeting, "low interest rates produce distortions or
unintended consequences that exacerbate some of our current
economic problems" like high unemployment.
This worsens the problem of U.S. income inequality, said Mr.
Lonegan, who was mayor of Bogota, New Jersey for 12 years.
"We wanted to let her know it's not just the left that cares
about the middle class and low-income Americans," Mr. Lonegan said
in an interview after the meeting.
According to the American Principles in Action website, Mr.
Lonegan is head of a project called Fix the Dollar "charged with
the responsibility of building national grassroots support for
sound monetary policy and restoring the gold standard."
Ms. Yellen has previously met with liberal activists at the
Fed.
Republican lawmakers accused Ms. Yellen at a House Financial
Services Committee hearing Wednesday of favoring Democrats, citing
on her official calendar, which shows she has held more meetings
over the past year with executive branch officials than with
members of Congress, and met with more Democratic lawmakers than
Republicans.
Rep. Scott Garrett, a New Jersey Republican, told Ms. Yellen
during the hearing that her calendar, as well as her meeting with
"liberal advocacy groups" and a speech on inequality, were among
the factors that painted for him a picture of partisan bias. She
responded it was a "complete mischaracterization" to portray her
schedule and activities as partisan. She mentioned then that she
planned to meet Friday with the conservative group.
Mr. Lonegan said his group supports Sen. Rand Paul's (R., Ky.)
so-called Audit the Fed legislation, which would give Congress
greater direct oversight on monetary policy. Proponents say it
would increase central-bank transparency. Ms. Yellen repeated
Thursday she strongly opposes the bill because it would threaten
the Fed's independence.
Write to Pedro Nicolaci da Costa at pedro.dacosta@wsj.com