Marketplace All-in-One A Fed divided against itself
Dec 2, 2025
In this discussion, Daniel Tarullo, a former Federal Reserve Board member and Harvard Law School scholar, delves into the recent divisions among Fed officials regarding the balance between job growth and inflation. He highlights the complex dynamics at play within the FOMC, including political influences and differing data assessments. Tarullo also reflects on the importance of consensus at the Fed and shares concerns about its independence and structure. The conversation touches on implications for economic policy and the Fed's leadership under Jerome Powell.
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Fed Facing A Mandate Trade-Off
- The Fed is splitting between prioritizing inflation control and supporting employment right now.
- Daniel Tarullo says these divides reflect data assessments and members' predispositions toward the mandates.
Reserve Presidents Signaling Boundaries
- Regional Fed presidents are signaling limits to how accommodative policy should become.
- Tarullo reads those public comments as a message to any incoming chair not to quickly reverse course.
Chair's Dual Role: Analysis And Consensus
- The Fed chair must provide analytic leadership and forge consensus on policy.
- Tarullo praises Jerome Powell for combining analysis with consensus-building through a difficult period.