According to OpenSecrets.org, Federal Reserve employees have overwhelmingly donated to Democrats this election cycle, with $552,000 going to blue candidates and only $51,000 going to Republican candidates. It was a dollar amount.
The woeful underestimation of Republicans underscores concerns that the Fed is becoming politically unbalanced.
The Fed has tremendous influence over the economy, and its interest rate decisions affect mortgages, employment, and inflation rates for all Americans. But with so few staffers supporting the Republican Party, questions are growing about whether the Fed's inner circle has moved much further to the left than the majority of Americans.
Recent Federal Election Commission data reveals just how skewed donations are. For every dollar that Fed officials gave to Republicans, Democrats gave nearly $11. Critics say the imbalance could be indicative of a liberal culture within the Fed, with some questioning whether it is as “neutral” as it claims.
The Fed's decision to cut its benchmark interest rate by 50 basis points on the eve of the election raised concerns that the move was timed to boost Kamala Harris' campaign. The Fed has cut rates in election years, but this was the first time it had done so so close to an election. The last time the Fed significantly lowered the federal funds rate on the eve of an election was in 1984, as part of an earlier cycle of cuts.
The Fed's political support was not always unilateral. In 2012 and 2014, Fed officials gave slightly more to Republicans than to Democrats. However, since 2016, when Trump was first elected president, donations have overwhelmingly gone to Democrats.
Some lawmakers are also paying attention.
“When Fed officials are funding almost one political party, it's natural to question whether they're listening to every voice in America,” said one Capitol Hill staffer. “This is not just a political issue. It's about making sure that America's central bank reflects America.”
