A good profile on Janet Yellen, and how her journal could change Washington. The most important part, I think, lies here:
By a number of accounts, no one feels this more intensely than Yellen, who understands not just the human cost to individual lives and families but also the damage that a demoralized workforce can do to the economy as a whole. One of her most important papers, written with her husband, Nobel Prize winner George Akerlof, showed that workers who feel underpaid will be less productive. “She does see long-term unemployment, massive unemployment, as not only an economic problem or in terms of wasted resources but also as a human being,” says John Williams, president of the San Francisco Fed, who was Yellen’s research chief when she ran it. “It is very destructive to families.… This is passionate with her. Among economists, you don’t often see that human side. With her, it’s not just an abstraction, and if you try to treat it too much as an abstraction, she’ll react.”
There is a human cost to policy. What the Fed does affects the lives of millions of people, and the fact that five years after the financial crisis we’re still not near full employment is a huge loss of well-being.
I know there are downsides to pushing too hard, but I can’t believe that it outweighs the suffering that 5 years of a terrible labor market have created.