In Defense of Workers, Sanders Says 'The Fed Must Stop Raising Interest Rates'

U.S. Sen. Bernie Sanders on Thursday reaffirmed that, with record corporate profits and declining median wages, federal policymakers should focus not on aggressively raising interest rates, but rather on tackling corporate greed and economic policies that benefit working-class Americans.

"I think it is wrong to be saying that the way we're going to deal with inflation is by lowering wages and increasing unemployment."

"Corporate profits are at a 70-year high, median wages have gone down the sharpest in 25 years, and corporations are spending $1 trillion on stock buybacks. Our goal must not be to 'get wages down.' Our goal must be to end corporate greed," Sanders tweeted. "The Fed must stop raising interest rates."

It's an argument that the two-time Democratic presidential candidate has often made in recent weeks. Appearing on NBC News' "Meet the Press" last Sunday, Sanders said that "I think it is wrong to be saying that the way we're going to deal with inflation is by lowering wages and increasing unemployment."

"That is not what we should be doing," he added. "This inflation thing is a real issue. It is a global issue. But at a time when working families are struggling when the people on top are doing phenomenally well, I don't think you go after working people."

Consumer Price Index data released last week by the U.S. Bureau of Labor Statistics showing prices rising higher than anticipated in September called into question whether the U.S. Federal Reserve's recent interest rate hikes are doing anything to target the corporate greed that progressive economists contend is a key driver of--and smokescreen for--inflation.

The Fed has raised rates by 75 basis points at its past three meetings--they're currently set at between 3.00% and 3.25%--and is expected to further increase rates to around 4.5% by the end of 2022, and possibly as high as 5.5% next year, according to economist Nick Sargen.

"Moving in these 75-basis-point steps was effective when the Fed had a long way to go," Brian Sack, a former Federal Reserve Bank of New York official, said earlier this month. "It becomes more problematic when they need to calibrate policy more carefully, and I believe we're approaching that point."

Progressive economist and Nobel laureate Joseph Stiglitz recently asked, "Will raising interest rates lead to more oil, lower prices of oil, more food, lower prices of food?"

The "answer is clearly not," he said. "In fact, the real risk is it will make it worse... Why? Because what we need to do is to make investments to relieve some of these supply-side bottlenecks that are causing such havoc on our economy... Raising interest rates in noncompetitive markets may lead to even more inflation."