Congress

The Federal Reserve chairman is in demand amid economic danger signs

The Fed chairman is stepping up the number of group meetings on his dance card, including with House Democrats

Powell has been making himself readily available to lawmakers. (Tom Williams/CQ Roll Call file photo)

It must be nice to get your own personal report on the economy from the head of the world’s largest central bank.

Federal Reserve Chairman Jerome Powell met with roughly 70 House Republicans at the whip team meeting prior to Monday night votes, where, among other things, he talked about the Fed recently lowering its economic growth projections for 2019 and 2020.

While Powell frequently meets or calls individual members, such larger meetings appear to be rare, according to a review of his calendar.

But the Fed chairman is stepping up the number of group meetings on his dance card, including with House Democrats.

House Financial Services Committee Chairwoman Maxine Waters of California told CQ that she and the panel’s subcommittee chairmen had been invited to meet with Powell Tuesday evening, and that the Fed chairman is expected to meet with the House Democratic caucus at a later date.

The Fed did not comment on Powell’s meetings, except to direct attention to Powell’s monthly calendars, which are posted on the central bank’s website. 

A look at the last six published monthly calendars — August 2018 to January 2019 — shows Powell tends to favor one-on-one meetings. The calendars list 29 such meetings with Senate and House members, one with three members and a Nov. 26, 2018 dinner with a bipartisan group of 11 senators. The calendar also lists 22 phone calls with Senate and House members during this period.

When it comes to economic projections, March has been an interesting month. The administration was criticized March 11 when it unveiled a budget based on assumptions that the economy would grow at a 3.2 percent rate this year, 3.1 percent in 2020 and 3.0 percent from 2021 through 2024.

Other forecasts, notably the Fed’s and the Congressional Budget Office’s, put 2019 growth at just 2.3 percent and closer to 2 percent into the next decade. At its March 20 meeting, the interest rate-setting Federal Open Market Committee lowered its 2019 growth estimate to 2.1 percent, widening its gulf with the White House forecast to 1.1 percentage points. The 2020 estimate was lowered from 2 percent to 1.9 percent, while the 2021 forecast remained at 1.8 percent.

Overall, the Monday evening discussion with House Republicans was about the economy’s “remarkable” highlights, including unemployment hitting a 50-year low earlier this year and a growing percentage of Americans entering the labor force, said Rep. Tom Graves, a Georgia Republican, who was at the meeting.

“It was a really neat picture of things are moving in the right direction,” Graves said.

He said there was also some discussion about the Fed underestimating the rate of growth last year spurred by an “economic burst” from the tax code overhaul, and this year’s decline in expected growth. While Powell talked about “sustained growth,” it was in the 2 percent range “over the next so many years,” Graves said.

Trump’s budget has growth falling to 2.9 percent at the lowest over the next decade. Democrats have pointed to the tax code changes as causing a short-term “sugar high” for the economy that is now wearing off.

Some Republicans who attended the meeting Monday preferred to attribute the reduced growth forecast to external factors, including a “global slowdown,” said Rep. French Hill, R-Ark., which has been impacting major advanced economies from Europe to China.

Hill noted that Powell had promised to be accessible to Congress when he was nominated, and that he’s following through on that pledge.

Hill is a former Treasury Department deputy assistant secretary who was rumored during the last Congress to be a favorite to fill an empty Fed seat until he nixed the idea. He is one of the few lawmakers listed more than once on Powell’s calendar since last summer.

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