Adam Tooze on Trump’s War on the Fed

>> NOW, AS WE SAID, IN HIS LENGTHY SPEECH HERE AT THE UNITED NATIONS TODAY, PRESIDENT TRUMP REPEATED AGAIN AND AGAIN HOW STRONG THE U. S. ECONOMY IS UNDER HIS LEADERSHIP.

BUT DOES THIS REFLECT REALITY?

THE FEDERAL RESERVE IS LOWERING INTEREST RATES IN AN EFFORT TO LIFT UP THE DETERIORATING U. S. LABOR MARKET, BUT IT'S THE FIRST TIME SINCE DECEMBER THAT ITS TAKEN ANY ACTION, SO, HOW CAN THE FED BECOME MORE RESPONSIVE TO THE NEEDS OF DEMOCRACY?

IN HIS LATEST "NEW YORK TIMES" ESSAY, ADAM TOOZE IS TRYING TO ANSWER THAT QUESTION BY TAKING A DEEP DIVE INTO THE AMERICAN CENTRAL BANKING SYSTEM.

AND EXPLORING THE CHALLENGES IT FACES TODAY.

HE ED WALTER ISAACSON TO EXPLAIN.

>> THANK YOU, CHRISTIANE.

ADAM, WELCOME TO THE SHOW.

>> GLAD TO BE HERE.

>> IN A SUPREME COURT RULING THIS PAST MAY, WHICH IT ALLOWED THE PRESIDENT TO DISMISS A LOT OF EMPLOYEES FROM INDEPENDENT AGENCIES, IT HAD A CARVEOUT FOR THE FEDERAL RESERVE, AND IT SAID IT WAS A UNIQUELY STRUCTURED QUASI-PRIVATE ENTITY WITH A DISTINCT HISTORIC TRADITION.

EXPLAIN THAT TO ME.

>> YEAH, THIS IS ABOUT AN EXTRAORDINARY FACT THAT THIS CENTRAL AGENCY OF GOVERNMENT, I THINK EVERYONE, GENERALLY, WHEN THEY FOLLOW THE NEWS, THINKS OF THE FED AS PART OF THE GOVERNMENT, THE AMERICAN STATE, DOES INDEED HAVE ORIGINS IN 19th CENTURY BANKING POLITICS, AND THIS MAKES IT LIKE OTHER CENTRAL BANKS.

CENTRAL BANKS ARE BANKS TO BANKERS, AND BANKERS ARE A VERY POWERFUL LOBBY BROWN.

FROM THE LATE 19th CENTURY ON, IT WAS CLEAR THAT AMERICA AS IT ENTERED THE 20th CENTURY WAS GOING TO NEED A CENTRAL BANK, AND THIS WAS A HUGELY CONTROVERSIAL ISSUE IN GILDED AGE AMERICA, WITH POPULOUS PARTS OF THE U. S. PROTESTING AND WANTING EASY MONEY AND WALL STREET, WHICH, AT THE TIME, WAS VERY REMOTE FROM OTHER PARTS OF THE U.S., ANCHORING ITSELF ON THE GLOBAL GOLD STANDARD THAT WAS CENTERED ON LONDON AT THE TIME.

>> SO, THAT BEGINS IN 1913, WITH THE FED AND IT'S A TIME WHEN WILLIAM JENNINGS BRIAN RUNNING FOR PRESIDENT IS SAYING THAT WE SHOULDN'T BE CRUCIFIED ON THE CROSS OF GOLD.

THEY WANT EASY MONEY, THEY WANT, YOU KNOW, THEY DON'T WANT --IS THAT WHY THE FED WAS STARTED, SO THAT THE BANKERS COULD HAVE A MORE STABLE CURRENCY?

>> IT'S A COMPROMISE.

SO, DE FACTO THE U. S. AFTER THE CIVIL WAR WAS ON THE GOLD STAND ABOUT, WHICH WAS PUNISHINGLY AUSTERE, RIGHT?

TO GET BACK TO THE GOLD STANDARD AFTER THE U. S. CIVIL WAR, THERE BECAUSE SEVERE DEFLATION.

AMERICAN FEDERAL GOVERNMENT AT THE TIME IS A TINY, TINY FRACTION OF THE AMERICAN ECONOMY.

SO, EFFECTIVELY, IT WAS TIED TO THE BRITISH-BASED GOLD SYSTEM, AND THAT'S WHAT PROVOKED THE POPULIST BACKLASH OF THE 1890s.

THINK OF THIS IN TERMS OF NEGATIVE EQUITY, IF YOU HAVE A MORTGAGE ON A PROPERTY NOW, IF YOU'RE IN THE SUBURBS, OR IF YOU'RE A FARMER, AND ALL OF A SUDDEN, THE PRICE OF EVERYTHING STARTS FALLING, INCLUDING THE VALUE OF YOUR PROPERTY.

YOU'RE IN A PICKLE, BECAUSE YOU ARE GOING TO END UP IN DEEPER AND DEEPER NEGATIVE EQUITY.

WILLIAM JENNINGS BRYAN'S GREAT RUN FOR HIS RUN FOR THE PRESIDENCY SEVERAL TIMES WAS ALL ABOUT TRYING TO LOOSEN THAT CROSS OF GOLD THAT WAS BEING PRESSED DOWN.

FROM THE POINT OF VIEW OF WALL STREET, THE MONEY THERE IS A CAUSE OF HUGE PANIC.

SO, WHAT DO YOU DO?

BY 1913, UNDER THE STEWARDSHIP OF THE VERY COOLLY PROCESSIVE, QUITE ARIS CATTIC FIGURE OF WOODROW WILSON, YOU HAVE A COMPROMISE.

AND IT HAS ELEMENTS OF THE WALL STREET BANKING INTEREST AND IT HAS ELEMENTS OF POPULISM.

AN THEN A STRUGGLE HAS UED, AND THEN HAS NEVER STOPPED, ABOUT WHAT THE FED'S PRIORITIES ARE AND WHAT IT SHOULD GIVE THE CENTRALITY TO.

SHOULD IT BE MONETARY STABILITY, SHOULD IT BE COB NEXTS TO THE WIDER WORLD?

OR SHOULD IT BE THE INTEREST OF AMERICA'S DOMESTIC POLITICAL ECONOMY AS DIVERSE AS THOSE ARE, RIGHT?

SO, THAT'S THE KIND OF SETUP AND, INDEED, WE'RE STILL LIVING IN THAT -- IN THAT ARGUMENT, THAT ONGOING ARGUMENT.

>> WELL, THE CURRENT ARGUMENT ABOUT THE FED, REALLY, IT SEEMS TO BEGIN IN 1979, WITH PAUL VOLCKER, WHERE HE REALLY JACKS UP INTEREST RATES TO FIGHT INFLATION, AND YOU HAVE A TWO-PRONG SYSTEM.

TRYING TO FIGHT INFLATION, BUT TRYING TO KEEP UNEMPLOYMENT FROM GOING TOO FAR UP.

TELL ME HOW THAT IS --DEFINES THE FED TODAY.

>> I THINK I MIGHT ROLL IT BACK ANOTHER DECADE TO THE LATE '60s, OR, INDEED, THE '60s AND TAKE PEOPLE TO THE CIVIL RIGHTS MOVEMENT, BECAUSE THAT'S REALLY WHERE THE DEBATE ABOUT FULL EMPLOYMENT TAKES CENTER STAGE.

THE '60s ARE THOUGHT OF AS A PERIOD OF BIG GOVERNMENT, GREAT SOCIETY, WE'RE DOING THE MANIPULATION OF THE U. S. ECONOMY, AMERICA BEING A SOCIETY OF RACIALIZED INEQUALITY.

THE REALLY CUTTING QUESTION, THE CANARY IN THE GOLD MINE IS BLACK MALE UNEMPLOYMENT.

NO ONE UNDERSTOOD THIS BETTER THAN THE MARTIN LUTHER KING WING OF THE CIVIL RIGHTS MOVEMENT.

SO, FROM THE '60s ONWARDS, THERE'S AN ARGUMENT GOING ON ON THE AMERICAN LEFT ABOUT WHAT THE PRIORITIES OF ECONOMIC POLICY SHOULD BE.

AND THOSE ARE WRITTEN IN THE '70s, WHILE THE BATTLE IS STILL GOING ON FOR THE HEARTS AND MINDS OF AMERICAN POLITICS.

LAST REALLY GREAT STRUGGLE, INTO THE HUMPHREY HAWKINS FEDERAL RESERVE ACT, WHICH GIVES IT THE DUAL MANDATE THAT YOU REFER TO, ONLY SHORTLY THEREAFTER, FOR THE CARTER APPOINTED HARD MONEY BOARD OF THE FED, COMING OUT OF WALL STREET WITH PAUL VOLCKER AT THE HELM.

WE THINK OF HIM AS A LOVELY CENTRIST, BUT HE WAS A HARD MAN OF MONEY, TO YANK UP INTEREST RATES, AS YOU SAY, AND FUNDAMENTALLY TILT AMERICA'S POLITICAL ECONOMY AWAY FROM THE AMERICAN WORKING CLASS, UNEMPLOYMENT SHOOTS UP.

THERE'S AN ARGUMENT ABOUT HOW VOLCKER HIMSELF INTENDED THIS, BUT THERE WERE KEY MOMENTS IN HIS VARIOUS SPEECHES WHERE HE MAKES PRETTY CLEAR THAT HE UNDERSTANDS THE BREAKING TRADE UNION POWER IS KEEP TO SHIFTING AMERICA'S POLITICAL ECONOMY, AND JUST FROM A TECHNOCRATIC POINT OF YOU, ONCE DO THAT, IT'S EASIER TO ADJUST THE COST OF LIVING.

THE BIG TRADE UNIONS IN THE '70s ARE ALL ABOUT INDEXING.

THAT'S BROKEN IN THE '70s BY THE VOLCKER SHOCK.

AND SO, THEN WE EMERGE IN THIS NEW WORLD OF INDEPENDENT CENTRAL BANKING, WITH TECHNOCRATIC LEADERSHIP.

Ph.

D IN ECONOMICS IS THE MINIMUM QUALIFICATION FOR THIS INCREDIBLY POLITICAL JOB.

>> IN "THE NEW YORK TIMES" OPINION PIECE THAT YOU WROTE RECENTLY, YOU SAID, WHEN YOU'RE TALKING ABOUT PRESIDENT TRUMP TRYING TO INFLUENCE OR OVERWHELM THE FED, YOU SAID, WE SHOULD START BY THINKING, WHAT TYPE OF CENTRAL BANK DO WE WANT TO HAVE?

TELL ME WHAT YOU MEAN BY THAT.

>> WELL, TAKE THIS AS A PARTICULAR INSTANCE OF A MORE GENERAL DILEMMA OF PROGRESSIVE PEOPLE IN THE U. S. RIGHT NOW IN THE FACE OF THE TRUMP ONSLAUGHT, WHICH IS, IS OUR FIRST AND PRIMARY REFLEX AND INDEED IN SOME SENSES DUTY AND RESPONSIBILITY TO JUST SIMPLY DEFEND THE STATUS QUO AGAINST THIS ONSLAUGHT, OR DOES THAT CONDEMN YOU TO A LACK OF IMAGINATION AND ULTIMATELY ALSO A LACK OF ABILITY TO MOBILIZE AGAINST TRUMP?

BECAUSE ONE OF THE THINGS THAT'S ENERGIZING MAGA RIGHT NOW, THEY'VE UNLEASHED THE POLITICAL IMAGINATION OF THEIR PEOPLE.

THERE'S NOTHING THEY DON'T THINK THEY CAN DO.

AND THE PROBLEM WITH THE DEFENSIVE POSITION THAT'S BEEN ADOPTED, I THINK, BY MANY PEOPLE IN --IN NOT JUST THIS AREA OF CENTRAL BANKING, BUT ACROSS THE BOARD, IS THAT IT ROBS YOU OF THAT OPPORTUNITY TO KEEP THINKING.

AND THAT'S WHAT I'M APPEALING FOR US TO DO, BUT ALSO, SIMPLY, I MEAN, NOT JUST ON KIND OF META GROUNDS, BUT TACTICALLY.

SAY THAT TRUMP MANAGES TO SEIZE CONTROL OF THE FED.

WHEN, YOU KNOW, THE MOMENT COMES WHERE THE DEMOCRATS TAKE BACK CONTROL OF CONGRESS AND MAYBE THE WHITE HOUSE, WHAT'S THE AGENDA GOING TO BE?

ARE WE GOING TO SIMPLY RESTORE THE OLD FED?

SAY WE MANAGE TO STOP HIM, SAY THE COURTS S ACTUALLY BOMB HIS BLOCK HIS EFFORT.

SAY THEY DON'T MANAGE TO FIRE LISA COOK.

IS THE NEXT MOVE GOING TO BE TO MAKE IT EVEN HARDER TO FIRE GOVERNORS OF THE FEDERAL RESERVE?

>> WELL, WHAT'S YOUR ANSWER THERE?

WHAT SHOULD WE DO TRYING TO DO WITH THE FED?

>> WHAT I THINK WE SHOULD BE TRAIING TO DO IS THINK ABOUT WHAT WE THINK A DEMOCRATIC FED WOULD LOOK LIKE.

A PROPERLY DEMOCRATIC -- >> DEMOCRATIC MEANING RESPONSIVE TO THE PEOPLE, NOT TO THE DEMOCRATIC PARTY.

>> AND TO THEIR REPRESENTATIVES.

I THINK THE REAL ISSUE HERE IS CONGRESS.

IS --AND RIGHT NOW, THE FED BUDGET DOES NOT HAVE ANY SERIOUS CONGRESSIONAL OVERSIGHT.

THERE'S A KIND OF SYSTEM THAT RUNS BY THE POLITICIZATION OF THE APPOINTMENT OF FED GOVERNORS, BUT IT'S NOT ACTUALLY A ROUTINE MATTER.

AND I THINK THAT FED MANDATE THAT YOU TALKED ABOUT THAT WAS SET IN THE 1970s IS SOMETHING THAT COULD BE PERIODICALLY REVIEWED.

SO, AS TO DISCUSS THE QUESTION OF WHETHER WE'RE FOR INSTANCE MEASURING UNEMPLOYMENT RIGHTS, WHETHER WE'RE CAPTURING THE RIGHT THINGS, AND WE KNOW THAT JEROME POWELL, FOR INSTANCE, HIS --HIS CHAIRMANSHIP, AND THE BOARD HAS BEEN QUITE IMAGINATIVE IN DOING THIS, BUT THEY'VE BEEN DOING IT ESSENTIALLY ON THEIR OWN SAY-SO, RIGHT?

SO, THEY'VE BEEN LOOKING INCREASINGLY AT RACIAL INEQUALITY IN THE AMERICAN LABOR MARKET, AS A HIGHLY SENSITIVE MARKER.

THAT'S GREAT, BUT IT DOESN'T NECESSARILY HAVE ANY POLITICAL BACKING, AND THAT, I THINK, IS A WEAKNESS.

YOU COULD SAY --YOU COULD SAY, WE JUST CAN'T TRUST AMERICAN DEMOCRACY RIGHT NOW, ALLOWING CONGRESS TO INTRUDE MORE.

BUT THAT'S REALLY A --A LOGIC OF DEFEATISM.

AND THAT DEFEATISM IS WHAT ANIMATED THEM IN THE '80s AND '90s TO SAY, WE SHOULDN'T TRUST POLITICIANS.

YOU CAN SEE THAT RIGHT NOW IN THE ARGUMENTS BEING MADE.

THEY ARE ALWAYS AFTER THE NEXT ELECTION.

THAT'S THE ONLY THING ON THEIR MINDS.

SO, REALLY, WE SHOULD TAKE THE IMPORTANT THINGS AWAY FROM THEM.

AND THAT'S A CON DEN SENSE, REALLY, THAT I DON'T THINK AMERICAN POLITICS HAS MERITED AND DESERVED.

THE CURRENT MOMENT IS NO DOUBT A BAD ONE, BUT A BAD MOMENT IS NOT NECESSARILY THE RIGHT PLACE TO THINK STRATEGICALLY ABOUT OUR OPTIONS GOING FORWARD.

>> WELL, YOU SEEM TO BE ARGUING, THEN, FOR A MORE DEMOCRATIC FED, MORE RESPONSIVE TO POLITICS.

WELL, THEN, WHY ISN'T TRUMP RIGHT?

HE GOT ELECTED, WHY CAN'T HE DO WHAT HE WANTS WITH THE FED?

>> BECAUSE OF THE WAY HE'S DOING IT, RIGHT?

AND THE CLEAR INTENTIONALITY HERE TO JUST CYNICALLY BLOW THIS UP.

THE MECHANISMS THAT ARE BEING USED, THE ASSAULT, ESSENTIALRY, ON THE PRIVATE FINANCES OF BOARD MEMBERS THAT ARE SELECTED BECAUSE THEY'RE VULNERABLE.

THIS ISN'T AND ORDERLY, SERIOUS POLITICS OF MONEY.

THIS IS THE SAME OLD SAME OLD MAGA NO HOLDS BARRED ASSAULT.

PRECISELY, I THINK, SO IS THE CHANNEL, THIS IS ACTUALLY VERY VALUABLE IN SERIOUS CONVERSATION, INTO APPROPRIATE PATHS.

THERE SHOULD BE MECHANISMS FOR DOING THIS IN A MORE ORDERLY FASHION.

>> SUPPOSE THERE WERE A DEMOCRATIC PUSH BY THE PEOPLE, THROUGH TRUMP, TO SAY, HEY, LOWER INTEREST RATES.

IS THAT SOMETHING THE FED SHOULD RESIST OR SHOULD IT BOW TO THE WILL OF THE PEOPLE?

>> I MEAN, I DON'T SEE THERE'S ANY PROBLEM OF A POLITICS OF LOW INTEREST RATES BEING PUSHED.

ONE OF THE AFFECTS OF THE SORT OF STRUCTURAL CHANGE THAT I AM INVITING THAT WE THINK ABOUT, INVITING US TO THINK ABOUT, IS THAT IT WOULD FORCE POLITICAL PARTIES TO ACTUALLY OFFER AGENDAS ON THESE KIND OF ISSUES.

THE POINT IS NOT DO I APPROVE OF TRUMP'S PARTICULAR POLITICS OR NOT.

THE POINT I'M TRYING TO MAKE IS THAT, YOU KNOW, REFLEX AGAINST TRUMP'S TOXIC POLL SICKS, WE RULE OUT THE POSSIBILITY OF A MORE SERIOUS ARGUMENT ABOUT THIS ISSUE.

AND I DON'T DISAGREE WITH YOU, YES, A POLITICS OF MONEY AND INTEREST RATES IS NATIVE TO AMERICAN DEMOCRACY.

IT GOES ALL THE WAY BACK TO THE 19 th CENTURY.

READ WILLIAM JENNINGS BRYAN'S SPEECH.

THE RANGE OF SOPHISTICATED ARGUMENTS HE OFFERS IS EXTRAORDINARY BY MODERN STANDARDS.

WE'VE LOST ALL OF THAT.

AND I DON'T SEE HOW ENTRENCHING EXCLUSIVITY ON THIS ISSUE IS GOING TO MAKE THINGS ANY BETTER.

I THINK IN PRINCIPLE, WHAT IT PROBABLY DOES, AS IN SO MANY OTHER AREAS, IS TO BREED A KIND OF IRRATIONAL POPULISM IN THE --IN THE SWAMP THAT EMERGES BEYOND THE BOUNDS OF THE, YOU KNOW, RESPECTABLE DISCOURSE IN THE FED.

>> ALL OF THIS IS HAPPENING, THE FED, PERHAPS UNDERMINING ITS INDEPENDENCE, AND YET, THE BOND MARKET DOESN'T SEEM TO HAVE DONE MUCH.

WHY IS THAT?

>> WELL, I MEAN, IT'S TWO-SIDED.

IT HASN'T.

THERE'S BEEN NO PANIC.

I THINK THAT'S VERY IMPORTANT.

AND WE SHOULD GIVE CREDIT TO THE TREASURY PEOPLE.

BESSENT MAY APPEAR LIKE A TOTAL SYCOPHANT, BUT HE LOOKS LIKE HE KNOWS HIS BUSINESS.

THAT'S IMPORTANT.

BECAUSE IT'S A LIFE SUPPORT TYPE SYSTEM.

IT'S A THING WITH TRILLIONS OF DOLLARS GOING IN EVERY DAY, AND YOU JUST HAVE TO KEEP THE MONITORS IN THE EMERGENCY ROOM TICKING OVER, AND THEY'RE DOING A GOOD JOB AT THAT.

IF YOU LOOK AT INTEREST RATES, OVER THE LONG RUN, IT'S A SLIGHTLY DIFFERENT STORY, BECAUSE GERMANY WITH A LOW DEBT ENVIRONMENT AND VERY INDEPENDENT BANK BORROWS AT MUCH LOWER INTEREST RATES THAN THE UNITED STATES DOES NOW, SO, YOU CAN SEE IT IN THE YIELDS NOW.

EVEN FRANCE, WHICH SOME OF THE LISTENERS MAY HAVE SEEN, WAS A CRISIS CASE A COUPLE OF WEEKS AGO, BORROWS AT LOWER INTEREST RATES THAN THE UNITED STATES.

SO, THE UNITED STATES IS MOVING INTO THE ZONE OF A COUNTRY WITH A HEAVY DEBT BURDEN, WITH SOME QUESTIONS ABOUT ITS POLITICAL MANAGEMENT OF ITS MONETARY POLICY, AND THE CRUCIAL THING TO SAY IS, IT'S NOT A DISASTER.

THE SKY DOESN'T FALL.

DOES IT SHIFT OVER TIME, THE PARAMETERS OF ECONOMIC POLICY MAKING?

SURE IT DOES, BECAUSE IT MAKES MORE DEBT MORE EXPENSIVE.

AND THAT WILL CAUSE SOMEBODY LIKE TRUMP TO SAY, WELL, IF ONLY WE COULD HAVE LOWER INTEREST RATES.

SO, YOU GET CAUGHT IN THIS QUESTIONING, THEN, OF HOW ARTIFICIAL OR HOW NATURAL THOSE INTEREST RATES ARE, BUT IT DOESN'T PRODUCE AN IMMEDIATE DISASTER.

YOU HAVE OTHER PRIORITIES, LIKE THE 2008 FINANCIAL CRISIS OR THE COVID SHOCK, AND THEN YOU DO BIG POLICY.

AND THE U. S. DID.

AND BOTH OF THOSE WERE MAJOR AND HIGHLY SUCCESSFUL POLICY INTERVENTIONS.

THE QUESTION ABOUT THE TRUMP ADMINISTRATION IS, WHAT ARE THEY DOING IT FOR?

YOU KNOW, ALL OF THIS, AND WHAT IS THEIR POSITIVE PROJECT?

IT SEEMS BASICALLY BE TO GIVE HUGE, YOU KNOW, TAX GIVEAWAYS TO BILLIONAIRES.

THAT'S NOT A GOOD USE OF THE KIND OF POLITICAL FREE SPACE THAT YOU COULD HAVE.

BUT IF YOU WANTED TO DO A GREEN NEW DEAL, IF YOU WANTED TO DO A TRULY TRABS FORMATIVE SOCIAL AND ECONOMIC POLICY, IF YOU WANTED TO ELIMINATE CHILD POVERTY IN THE U.S., WE KNOW HOW TO DO IT.

IT'S A MATTER OF MONEY.

>> WAIT, BUT THOSE ARE POLITICAL JUDGMENTS IN THIS COUNTRY, AND THE COUNTRY'S MADE THE OTHER POLITICAL JUDGMENT FROM THE ONE IT JUST PUSHED.

>> YEAH, ABSOLUTELY.

I MEAN, THAT'S --I DON'T THINK ANYONE DISPUTES THAT.

IT'S A RIGGED SYSTEM, OF COURSE, WITH A HEAVILY CONSERVATIVE SENATE, BUT ABSOLUTELY, WITHIN THAT EXISTING STRUCTURE, IT EXPRESSES THOSE PRIORITIES ARE THERE.

WITH A LOT OF, YOU KNOW, I MEAN, THERE'S A LOT OF LEVERAGE BEING EXERCISED.

SO, I DON'T THINK IT'S NORMALIZED WHAT'S HAPPENED WITH THE BIG BEAUTIFUL BILL.

THEY HAD THE MAJORITY, THEY GOT IT THROUGH, BUT THAT'S --YEAH.

>> WELL, YOU COULD ARGUE FOR DEMOCRACY, YOU HAVE TO BE IN FAVOR OF DEMOCRACY, RIGHT?

>> I'M NOT FOR A SECOND DISPUTING THAT, RATHER THE CONTRARY.

>> OKAY.

THE CAUSE OF THIS IS THE PRESIDENT'S ATTEMPT TO PUSH LISA COOK OFF THE BOARD.

YOU'VE SERVED ON A COMMITTEE WITH HER.

TELL ME ABOUT HER.

>> SHE'S A VERY -- VERY, VERY SENSIBLE, DEDICATED ECONOMIST, POLICY MAKER, I WAS ON A COMMITTEE THAT WAS INVOLVED WITH ISSUES WITH GREEN FINANCE, ACTUALLY.

ONE OF THE, YOU KNOW, ONE OF THE ZONES OF IVE THINKING ABOUT CENTRAL BANKING THAT HAD A MOMENT OF OPPORTUNITY BETWEEN THE, YOU KNOW, THE GREEN NEW DEAL IN 2018, AND THE BIDEN ADMINISTRATION RUNNING OUT OF STEAM IN 2023, AMONGST THE INFLATION PANIC.

SO, THAT'S THE CONTEXT IN WHICH I GOT TO KNOW HER AND I WAS VERY GRATIFIED TO SEE THAT SHE ULTIMATELY WENT THROUGH A GRUELING --A GRUELING, GRUELING CONFIRMATION PROCESS IN THE SENATE, WHICH SHE ALREADY SUFFERED SAND SUFFER ED SLANDER AGAINST HER PROFESSIONAL RECORD.

THIS IS THE FIRST BLACK WOMAN TO BE APPOINTED TO THE BOARD, WORTH SAYING, AND AS SUCH, JUST RARE AS RARE AS CAN POSSIBLY BE, THE NUMBER OF BLACK WOMEN THAT CHOOSE TO AND ARE AWARDED ECONOMICS Ph.

Ds IN THE UNITED STATES IS LOW.

SO, SHE'S A PRECIOUS PERSON TO HER --TO HAVE FOUND HER WAY OR TO BE PROMOTED ONTO THE FED BOARD TO ENSURE THAT DIVERSITY STANDPOINT AND THAT EXPERTISE THAT'S LASER FOCUSED ON THE ISSUES OF STRUCTURAL INEQUALITY AND JUST BRINGING MACRO ECONOMIC CHOPS TO THAT JOB AND SO IT'S SCAN LAL DOUSE TO SEE HER ATTACKED IN THIS WAY.

>> DO YOU THINK THE U. S. IS IN A MOMENT WHERE IT REALLY COULD HAVE A SENSIBLE DEBATE ABOUT MONETARY POLICY?

>> AH, I HONESTLY DON'T KNOW.

BUT I ALSO FEEL THAT WE NEED TO WEIGH THE COSTS OF NOT POSING THE QUESTION.

AND WHAT I SEE RIGHT NOW ARE AN AWFUL LOT OF FOLKS SAYING, NOW IS NOT THE MENT, DON'T BRING IT UP.

THEN YOU UNDERSTAND HOW DANGEROUS THIS IS, AND AS I SAY, THAT FORCES US INTO A DEFENSIVE POSITION, WHICH, YOU KNOW, COMING FROM NEW YORK, WITH THE PROSPECT OF MAMDANI BEING ELECTED AS MAYOR, THERE'S A PART OF AMERICAN SOCIETY THAT'S ANSWERING IN DIFFERENT TERMS.

AND I FRANKLY COULDN'T HAVE FORGIVEN MYSELF IF I HADN'T AT THIS MOMENT WRITTEN A PIECE, SOMETHING LIKE THIS, NOT BECAUSE I NECESSARILY AM THE PERSON APPOINTED TO DO IT, BUT I'VE BEEN PART OF A DECADE-LONG CONVERSATION ABOUT THE POLITICS OF MONEY.

THE QUESTION HAS BEEN OPENED UP BY PEOPLE I WOULD RECOGNIZE AS MY ENEMIES.

DO I SAY, OH, NO, WE RALLY AROUND THE STANDARD OF TECHNOCRATIC INDEPENDENCE?

THAT'S NOT A POLICY WE CAN RESPONSIBLY ADVOCATE.

AND THIS IS A BLACKMAIL THAT WE'RE GOING TO BE CONTINUOUSLY SUBJECT TO.

IT HAPPENS IN LARGE PARTS IN EUROPE, AS WELL, WHERE WE'RE ALSO SEEING THE RISE OF THE FAR RIGHT, WHICH IS THE ARGUMENT, ZIP IT, NOW IS NOT THE MOMENT.

THAT'S A DIFFICULT QUESTION.

YOU SURE YOU WANT TO BRICK THAT UP?

I FIND THAT UNSETTLING NOW, EVEN COMING FROM THE LEFT.

I DON'T --I DON'T PERSONALLY SUBSCRIBE TO THAT, AS A VIABLE POLITIC.

IT'S A SELF-MUTE LAKE, FOR FEAR OF THE STRUGGLE AND THE FIGHT OVER THESE ISSUES.

>> ADAM TOOZE, THANK YOU SO MUCH FOR JOINING US.

>> THANK YOU.