The May, 2023 jobs report paints an optimistic picture of the U.S. economy, showing the addition of 339,000 jobs - a pleasant surprise for many who anticipated a slowdown. Yet, this report carries more weight than simple optimism. It plays an instrumental role in shaping the Federal Reserve's decision-making process, particularly whether to resort to an old lever: raising interest rates. Traditionally, the Federal Reserve has employed interest rate increases as a tool to manage inflation. The underlying principle is relatively straightforward: raising interest rates slows borrowing and spending, thereby tempering the labor market and reigning in price increases. However, such an approach also increases unemployment. Given increasing social volatility and our precarious cultural position, we must question the efficacy of this strategy in our evolving economic landscape. The impact of the Covid-19 pandemic continues to transform our world, including the economy, in profound ways. A
The prospect of a federal government default is a daunting scenario that would have far-reaching consequences for every sector of society, but the impact of such an event would disproportionately affect marginalized communities, including Black Americans. Given the historical and systemic inequities this sector has endured, any economic disruption resulting from a federal default would exacerbate current disparities and further marginalize this already disadvantaged group. We explore the potential repercussions of a federal government default on Black people and highlight the need for proactive measures to mitigate these effects, which we estimate to be $132 billion in the case of a protracted default. (Note that our estimate does not include direct stock market impacts since only 34 percent of Black families own any equities according to the Federal Reserve Board, compared with 61 percent of White families. Our estimate also has a shorter time frame than other studies.) Economic Inse