I 

114TH CONGRESS 

1ST SESSION H. R. 3541 

To amend the Federal Reserve Act to modify the goals of the Board of 

Governors of the Federal Reserve System and the Federal Open Market 

Committee. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 17, 2015 

Mr. CONYERS (for himself, Ms. KAPTUR, Ms. WILSON of Florida, Mr. ELLISON, Ms. JACKSON LEE, Mr. JOHNSON of Georgia, and Mr. PAYNE) introduced the following bill; which was referred to the Committee on Financial Services 

A BILL 

To amend the Federal Reserve Act to modify the goals 

of the Board of Governors of the Federal Reserve System 

and the Federal Open Market Committee. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘The Full Employment 

5 Federal Reserve Act of 2015’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 


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1 (1) In recent decades, the economy has stopped 

2 working for working families in the United States. 

3 (2) Despite significant gains in workers’ pro4 ductivity and gross domestic product over the past 

5 30 years, workers have seen their wages stagnate 

6 and sometimes fall. 

7 (3) The benefits of the powerful economy of the 

8 United States have gone almost entirely to the rich9 est people in society, which has created a growing 

10 gap between the wealthy and the rest of our country. 

11 (4) Such widening disparities are unhealthy for 

12 our democracy and unhealthy for the broad swath of 

13 working families who are unable to afford to pay 

14 their rent or buy a home, save for their children’s 

15 higher education, or afford the basic necessities to 

16 live a dignified and full life. 

17 (5) One major factor contributing to this grow18 ing economic crisis has been the lack of full employ19 ment in the economy of the United States. 

20 (6) Too many workers struggle to find jobs, 

21 and the jobs that are available often do not pay a 

22 good wage. 

23 (7) In the absence of a tight labor market and 

24 genuine full employment, workers are at the mercy 


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1 of their employers and cannot ask for raises or leave 

2 for better job opportunities. 

3 (8) As a result of workers’ decreased bargaining 

4 power, corporate profits and executive compensation 

5 have accounted for an increasingly large share of 

6 gross domestic product, leaving the large majority of 

7 workers in the United States behind. 

8 (9) Since 1980, the economy of the United 

9 States has had an excessively high level of unem10 ployment 70 percent of the time, according to the 

11 Congressional Budget Office’s official estimate of 

12 full employment (that is, the nonaccelerating infla13 tion rate of unemployment, or ‘‘NAIRU’’). 

14 (10) This contrasts with the 1949–1979 era, 

15 when the economy of the United States was func16 tioning below full employment only 31 percent of the 

17 time. 

18 (11) This persistently weak labor market has 

19 had tremendous consequences not only for the unem20 ployed and underemployed, but also for employed 

21 workers who have been unable to negotiate for high22 er wages and better working conditions, including 

23 the following examples: 

24 (A) Since 1979, although economy-wide 

25 productivity has grown by 64.3 percent, womVerDate Sep 11 2014 04:01 Sep 22, 2015 Jkt 049200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3541.IH H3541

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1 en’s median wages have risen by only 20.6 per2 cent and men’s median wages have actually fall3 en by 8.9 percent, and the statistics for Black 

4 and Hispanic workers are even worse than for 

5 White workers. 

6 (B) Workers’ share of corporate income 

7 has shrunk significantly, from 82.3 percent dur8 ing the full employment economy of 2000 to 

9 75.5 percent today, a decline that means that 

10 workers will earn $535 billion less this year 

11 than they would have had the share remained 

12 stable, or approximately $3,770 per worker this 

13 year. 

14 (C) Between 2002 and 2014, inflation-ad15 justed hourly wages for the bottom seven deciles 

16 (that is, 70 percent of the workforce of the 

17 United States) fell, showing that wage stagna18 tion is not limited to low-income families. 

19 (D) Even highly educated workers are not 

20 thriving in this economy; wages for college-edu21 cated and advanced-degree workers fell in 2013 

22 and 2014, a time of economic growth for the 

23 economy at large. 

24 (12) Congress has mandated that the Board of 

25 Governors of the Federal Reserve System pursue a 


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1 dual mandate of ‘‘maximum employment’’ and ‘‘sta2 ble prices’’, which the Board of Governors has inter3 preted to mean full employment that is consistent 

4 with an inflation rate of 2 percent. 

5 (13) Since the Great Recession, the economy of 

6 the United States has consistently had an unemploy7 ment rate higher than the Board of Governors of the 

8 Federal Reserve System’s NAIRU and an inflation 

9 rate below the 2-percent target; consistently missing 

10 both targets has caused untold harm to hundreds of 

11 millions of people. 

12 (14) Today’s headline unemployment rate un13 derstates the continued weakness of the economy of 

14 the United States, including the following examples: 

15 (A) Long-term unemployment is elevated. 

16 (B) Involuntary part-time employment re17 mains very high, indicating a large pool of 

18 workers who would prefer to be given more 

19 hours. 

20 (C) The portion of prime-age adults who 

21 are in the labor force remains depressed, be22 cause so many millions of people have given up 

23 looking for work. 

24 (15) Although there is no empirical evidence 

25 that an inflation rate of 3 or 4 percent would be 


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1 harmful, or would be difficult to maintain at a stable 

2 rate, many observers believe that the Board of Gov3 ernors of the Federal Reserve System actually treats 

4 its 2-percent inflation target as a ceiling. 

5 (16) Over recent decades and even today, re6 fusal by the Board of Governors of the Federal Re7 serve System to tolerate any inflation means that it 

8 has consistently raised interest rates prematurely 

9 during recoveries, preventing the economy from 

10 reaching full employment. 

11 (17) Inflation remains below the already con12 servative 2-percent target of the Board of Governors 

13 of the Federal Reserve System and shows no signs 

14 of accelerating uncontrollably. 

15 (18) During the late 1990s, the economy of the 

16 United States began to reach genuine full employ17 ment, with an unemployment rate of below 4 per18 cent, which had tremendous benefits for the vast 

19 majority of people, including— 

20 (A) higher wages for everyone, including 

21 those at the bottom of the income ladder; 

22 (B) robust wage gains for African-Ameri23 cans and Hispanics, which shrank the tremen24 dous racial disparities in pay and wealth; and 


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1 (C) a large Federal budget surplus (and 

2 State budget surpluses), which meant money 

3 was available for key services like education, 

4 health care, and infrastructure investment. 

5 (19) One key reason that the economy ap6 proached full employment was that the Board of 

7 Governors of the Federal Reserve System resisted 

8 pressures to raise interest rates and let the unem9 ployment rate continue to fall. 

10 (20) Achieving genuine full employment should 

11 be the foremost economic priority of the United 

12 States, and all branches of the Federal Government 

13 should use their full power to accomplish this goal. 

14 SEC. 3. MODIFICATION TO THE GOALS OF THE BOARD OF 

15 GOVERNORS OF THE FEDERAL RESERVE SYS16 TEM AND THE FEDERAL OPEN MARKET COM17 MITTEE. 

18 Section 2A of the Federal Reserve Act (12 U.S.C. 

19 225a) is amended— 

20 (1) by inserting ‘‘(defined as an economy with 

21 an unemployment rate of not more than 4 percent 

22 and that generally includes a labor market in which 

23 median wages are rising with worker productivity, 

24 job seekers can find work, and involuntary part-time 


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1 work is at a minimum)’’ after ‘‘maximum employ2 ment’’; and 

3 (2) by striking ‘‘stable prices’’ and inserting ‘‘a 

4 stable rate of inflation’’. 

Æ 


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