Biden Has Republican Powell as Ally in Bid to Lift Labor’s Clout
President-elect Joe Biden wants to reverse the decades-long trend that has seen workers get an ever smaller piece of the economic pie.
And no matter which political party ends up controlling the Senate, Democrat Biden’s best bet for achieving that could rest with a Republican: Federal Reserve Chairman Jerome Powell.
From a higher minimum wage and increased power for unions to bigger taxes on capital gains and the wealthy, Biden has outlined an ambitious agenda to lift labor’s share of the income the economy generates.
“It’s time to reward work, not just wealth, in America,” Biden told reporters after a Nov. 16 meeting with union and corporate leaders to discuss the coronavirus pandemic’s effect on the economy.
The trouble for the president elect is that much of his program hinges on the Democrats taking control of the Senate, something that won’t be known until early January after run-off elections for Georgia’s two seats. If his party falls short -- as many political analysts expect -- he’ll have to largely fall back on executive and regulatory actions to try to tilt the playing field in the direction of workers.
Fortunately though for Biden, he’ll have a Fed chair in Powell who’s committed to returning the labor market to its pre-pandemic glory -- when unemployment was at a 50-year low of 3.5% and a wide swath of workers were enjoying wage gains. And Powell overhauled the central bank’s strategic framework to help bring that about.