A small but growing number of Democrats worry that the Federal Reserve could cause too much collateral damage in trying to control inflation.

In a ___ Letter to Fed Chair Jerome Powell On Tuesday, Sen. Sherrod Brown (D-Ohio) urged them to remember that Congress has tasked the central bank with maintaining both stable prices and full employment. The senator warned that the Fed’s actions could lead to massive layoffs.

“For working Americans who are already suffering from inflation, job cuts will make it worse,” Brown wrote. “We cannot risk the livelihoods of millions of Americans who cannot afford it.”

The letter represents Brown’s starkest warning this year about the consequences of the Fed raising interest rates, which would slow price growth by slowing the entire economy — a process known as recession. could cause if the Fed tightens too much.

Democrats and Republicans are the same. Most support Powell’s efforts., which included selling bonds the Fed bought to protect the economy during the pandemic, as well as the fastest interest rate hike in decades. After a sharp partisan divide over spending last year, bipartisan consensus on the Fed has been remarkable.

But more Democrats are showing signs of Fed skepticism, said Rakin Maboud, chief economist at the Groundwork Collaborative, a progressive think tank, which has been warning all year about the dangers of tighter monetary policy.

“We’re seeing more and more lawmakers sounding the alarm that the Fed is on the wrong track, jeopardizing the incredible recovery we’ve seen so far,” Mabud told lawmakers since June. said, referring to several comments.

“The Fed is at risk of plunging our economy into a deep recession,” Mabud said. “That’s basically what Powell has pledged to do. He’s hacking away at the one leg of the stool that holds up our economy, which is a strong labor market.”

Powell has indeed suggested that he thinks the labor market is so strong, workers have so much bargaining power for higher wages.

Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.) have led their peers in criticizing the central bank. Sanders said this month that the Fed is “damaging the situation” and that corporate greed is the real problem.

Warren has been tougher. “The Fed has no control over the actual drivers of rising prices, but the Fed can reduce demand by putting many people out of work and making families poorer,” Warren said at a hearing in June.

Sens. Sherrod Brown (D-Ohio) and Elizabeth Warren (D-Mass.) both sounded the alarm about how the Fed’s actions could affect workers.

Andrew Harnick for The Washington Post via Getty Images

A rise in interest rates squeezes the economy, making it more expensive to borrow money, slowing the economy and eventually causing price deflation as demand comes into balance with supply. Powell has acknowledged that the Fed can’t address the supply problems that contribute to inflation and that the drop in demand will cause some “pain” for everyday people.

So far, rate hikes have slowed the housing market, which is heavily dependent on borrowing, but have had no apparent impact on the broader economy. The latest figures show that inflation is as high as ever and unemployment is still at a very low 3.5%.

Powell and his colleagues are due to announce another rate hike next week, as well as fresh estimates of the potential economic impact. In September, they estimated that a rate hike would push the unemployment rate to 4.4 percent next year, potentially on par with a recession. The September estimate was half a percentage point higher than the July estimate because of how much the summer rate hike dampened inflation.

Several Democrats expressed concerns about the risks of rate hikes. In a Politico article earlier this month. Sen. Chris Van Hollen (D-Md.) said it was “important that they not impede the job recovery,” and Sen. Tina Smith (D-Minn.) said higher interest rates were “too much for some people. Not effective. The most important inflationary pressure we’re facing. But he and other Democrats still said they think Powell is doing a good job.

Back in June, Sens. John Hickenlooper (D-Colo.) and Ben Cardin (D-Md.) also expressed concerns. “When you raise interest rates it has a big negative impact, certainly on affordable housing,” Carden Told Hill.

Rep. Rowe Khanna (D-Calif.), meanwhile, told CNN At the beginning of October the Fed was too slow to fight inflation and now it is getting too aggressive.

“The feds don’t get the blame they deserve,” Khanna said.

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