The Federal Reserve Keeps People Unemployed

Dean Baker on 2016 July Jobs ReportThe New York Times had an interesting piece that reported on the ways in which Uber uses techniques learned from behaviorial economics to get drivers to work longer hours than they might want. The article concludes by saying that with changes in the economy, many workers may have no choice but to rely on Uber jobs.

In this context, it is worth mentioning the Federal Reserve Board. The Federal Reserve Board has raised interest rates twice in the last four months because it is concerned that the economy is creating too many jobs. It is expected to raise interest rates three more times this year.

If people consider it bad that workers have few options other than working for Uber, they should be very upset that the Fed is raising interest rates. These interest rates are helping to ensure that millions of workers have limited job opportunities.

–Dean Baker
Uber and the Federal Reserve Board

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