dr. spriggs. dr. spriggs, in your testimony you discuss how african-americans continue to suffer from overt employment discrimination. as concrete evidence of this fact, you point to evidence that the unemployment experience for better educated african-americans is worse than the unemployment rates for less educated whites. to what extent can and should the fed take such discrimination into account as it sets monetary policy? >> well, first, thank you as the ranking member for the full committee for joining us. when we look before the great moderation, the unemployment experience of blacks with more education looked like the unemployment of whites with more education. there was a significant closing of the gap that occurred between the passage of civil rights and as we came into the 1970s so much so if you looked at young men who were college educated, there was virtually no difference between being black or white. that gap was shrinking for other african-americans with less education. once we went int

dr. spriggs said there's a lack of demand. as we talk about regulations being too great and the debt being too great. he made the point that, you know, our 70% of our economy depends on people having money so they can spend it. i know in the african-american community, they spend every dime they get. if shops are closing down in african-american communities because they don't have any money. i am wondering what y'all think of what we do with regards to hurting growth in this country. what is your opinion on sequester and austerity and cutting pell grant and so on. i will yield to maybe dr. lacker. >> you ask a difficult and upsetting set of questions. you ask me to stray outside the bounds of federal rate policy. it's hard not to. baltimore is part of my district and thinking about the events that have transpired there in the last couple of years, it's hard not to think about why it is that african-american communities have lagged so far behind despite the last 50 years of efforts, despite the vast array of interventions we ma

dr. spriggs. dr. spriggs, in your testimony you discuss how african-americans continue to suffer from overt employment discrimination. as concrete evidence of this fact, you point to evidence that the unemployment experience to better educated african-americans is worse than the unemployment rates for less educated whites. to what extent can and should the fed take such discrimination into account as it sets monetary policy? >> first, thank you, as the ranked member of the full committee, for joining us. when we look before the great moderation, the unemployment experience of blacks with more education looked like the unemployment experience of whites with more education. there was a significant closing of the gap that occurred between the passage of the civil rights act and as we came into the late 1970s, so much so that if you looked at young men who were college educated, there was virtually no difference between being black or white. and that gap was shrinking for other african-americans with less

dr. spriggs. >> yes, dr. spriggs.each of you will be recognized for five minutes to give an oral presentation of your testimony without objection. each of your written statements will be part of the record. and with that, ms. george, we will recognize -- i'm sorry, we're going to go right in order, i guess. different from my sheet. but dr. lacker, we're going to have you go first. and you're now recognized for five minutes. >> thank you. good morning, chairman huizenga, ranking member moore, and chairman hensarling. i'm honored to speak to the subcommittee about the governance structure of the fed's regional reserve banks. to understand the fed structure, it's essential to understood the fed's purpose. prior to the founding of the fed, the banking system was often unable to adjust the supply of monetary assets flexibly enough in response to the changing needs of commerce. the fed was founded to furnish an elastic currency, in the words in the preamble to the federal reserve act. clearing houses, bank-owned cooperative

dr. spriggs. >> yes. >> each of you will be recognized for five minutes to give an oral presentation of your testimony, without objection. each of your written statements will be part of the written record -- we're going to go in order different from my sheet. >> good morning chairman. i'm honored to speak to the subcommittee about the federal reserve banks. it's essential to understand the fed's purpose. the banking system was often unable to adjust the supply of monetary assets flexibly enough to adjust the needs of the commerce. clearinghouses, bank owned cooperatives in larger cities played an important role in how periodic crisis were resolved before the fed. including the issuance of currency substitutes. clearinghouses were widely viewed as favoring the interest of large money center banks. reserve banks were modelled after clearinghouses. with no issue powers, and universal eligibility, the aim being to approve the role of clearinghouses, a plan for a centralized institution was rejected out of concern about wall street influence. proposal proposals were rejected, a measure of public