The Federal Reserve left interest rates unchanged despite calls from President Trump to cut them.
The workers who drive the trucks, who man the assembly lines, and who keep the grocery shelves stocked have a singular, pressing interest: the stability of their livelihoods and the ability to meet the rising costs of the very lives they are working so hard to sustain. The decision being made by the men in the marble halls of the Federal Reserve does not include their voice. It should.
We are told that the interest rates remain unchanged, a decision framed in the sterile, bloodless language of “inflation trajectories” and “economic outlooks.” We are told that this is a matter of technical calibration, a delicate balancing act performed by experts far removed from the kitchen tables of the working class. But there is no such thing as a neutral economic lever. When the cost of borrowing shifts, it does not move in a vacuum; it moves through the lives of the people.
On one side of this ledger, we see the political maneuvering of the executive branch, with Donald Trump calling for cuts to ease the pressure. On the other, we see the Federal Reserve officials, clinging to their independence and their mandates. To the casual observer, this looks like a constitutional or political dispute - a clash of titans over the steering wheel of the national economy. But if we apply the audit, we see that this is a distraction. The real dispute is not between a President and a Board of Governors; it is between the interests of those who hold the capital and the interests of those who provide the labour.
When interest rates are held high, the cost of credit rises. For the banker, the lender, and the holder of vast reserves, high rates can be a tool of preservation, a way to manage the value of their holdings against the erosion of inflation. But for the worker, high rates are a tightening of the noose. They are the reason the small business owner cannot expand his shop; they are the reason the young family cannot afford the mortgage on a modest home; they are the reason the cost of a car loan becomes a weight that threatens to pull a household into the red.
The tension between the administration and the Fed is a theatre of shadows. The calls for cuts are often framed as a way to stimulate growth, yet we must ask: growth for whom? If the growth produced by lower rates merely serves to inflate the assets of the wealthy while the wages of the worker remain stagnant, then the “stimulus” is nothing more than a subsidy for the creditor class. Conversely, if the Fed maintains high rates to combat inflation, they are essentially using the purchasing power of the worker’s paycheck as a sacrificial lamb to stabilize the currency. In both scenarios, the worker is the one being asked to bear the cost of the adjustment.
We see the division clearly here. The political class fights over the mechanics of the machine, while the people who are crushed by the machine’s gears are left to wonder why the gears are turning at all. The debate over “inflation severity” or “job growth outlooks” treats the economy as a weather pattern - something that happens to us, rather than something that is constructed by us. It obscures the fact that inflation is often the result of the same concentrated power that allows for wage suppression.
The true strength of the people lies not in influencing the interest rate, but in influencing the distribution of the wealth that the interest rate seeks to regulate. If the workers of this nation understood that the “stability” the Fed seeks is often just the stability of their own subordination, they might look past the shouting matches in Washington. The leverage does not lie in the halls of the Federal Reserve; it lies in the collective refusal to accept a reality where our economic survival is a secondary consideration to the management of capital. We must move from being the subjects of economic policy to being the authors of our own economic destiny.