Fed president: People would rather have recession than high inflation
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Neel Kashkari, the president of the Federal Reserve Bank of Minneapolis, says one of the things he has learned in the past few years is that consumers would rather see the economy fall into a recession than to continue to suffer the pain of soaring prices.
«The American people – and maybe people in Europe, equally – really hate high inflation,» Kashkari told the Financial Times podcast «The Economics Show with Soumaya Keynes» last week. «I mean, really, viscerally hate high inflation.»
Neel Kashkari is president of the Federal Reserve Bank of Minneapolis. (Victor J. Blue / Bloomberg / File / Getty Images)
Kashkari, who has led the Minneapolis Fed since 2016, said he has participated in several roundtable discussions with labor groups and workers around his region over the past couple years, and the comment that stuck with him the most was from a labor leader who represents low-income service workers.
The Minneapolis Fed chief said the labor leader represented workers in grocery stores and hotels, not higher-paid laborers like autoworkers or welders.
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«She said to me, ‘Inflation is worse than a recession,’» Kashkari recalled. «That is contrary to conventional economic thinking. And I said, 'I don't understand that. How can inflation be worse than a recession? In a recession, you lose your job. Inflation is paying higher prices, [but] you still have a job.'»
Heritage Foundation public finance economist E.J. Antoni tells «The Big Money Show» that U.S. inflation data has been «astronomical» since President Biden took office.
Kashkari said the
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