THE JUSTICE
JANET YELLEN ADDRESSES ECONOMICS STUDENTS
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NEWS
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TUESDAY, SEPTEMBER 24, 2019
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BRIEF
Study finds sexual harassment to be a prominent issue in the medical field
LAUREN BERK/the Justice
A SOLID RESUME: Janet Yellen, the former chair of the Federal Reserve Bank, served under Presidents Barack Obama and Donald Trump. She was also the vice chair of the Federal Reserve System, chaired the Council of Economic Advisors and more.
JANET YELLEN: Expert talks about state of U.S. economy CONTINUED FROM 1 Alan Greenspan, Ben Bernanke and Paul Volcker — wrote an opinion piece in the Wall Street Journal defending the apolitical nature of the Federal Reserve. Referencing this opinion piece, Yellen said, “We feel strongly that monetary policy works best for the benefit of society at large, for [the] economic wellbeing of Americans when it’s made in this way.” Politicizing the Federal Reserve, she said, would be a “grave mistake.” Markets tend to perform poorly when politics are brought into the mix, such as in the context of the Trump administration’s ongoing trade war with China. The trade war has weakened the global economy as businesses put their investments on hold in the face of economic uncertainty, Yellen said. If the Federal Reserve were politicized, “we would have policy decisions that are motivated by the President’s electoral interests and may [boost] the economy in the runup to the election and then have high inflation later. They would eventually force a downturn and the economy would become more cyclical and would have lower performance,” Yellen told the Justice Saturday. Yellen also spoke in depth about the actions taken by the Federal Reserve and governments in the wake of the 2008 financial crisis, and the impact of those decisions on the United States government’s current relationship with big banks. At the outset of the financial crisis, The Federal Reserve and the Department of the Treasury made loans to large firms against good collateral, assets that serve as security for a loan. They also bought millions of mortgage-backed securities from the companies Fannie Mae and Freddie Mac, which buy mortgage loans and package them into securities, after the government took control of their finances. The government has held control of Fannie Mae and Freddie Mac for the past 11 years, but the Treasury Department recently put out a plan to re-privatize the companies, according to a USA Today article. While the Federal Reserve does not normally lend companies taxpayer dollars, tax dollars were the main source of funds for the loans to Fannie Mae and Freddie Mac, as well as for the 2008 bailout of big banks and investment banks such as Goldman Sachs and the American International Group.
Cecchetti then asked if the United States economy is safer today than before the financial crisis. Yellen responded that with the passage of the Dodd-Frank Act in 2010, the U.S. saw large improvements in regulating its banking system. The Dodd-Frank Act’s reforms included increasing the liquidity threshold for banks, which would require banks to keep more spare liquid assets, or cash, on hand; and requiring them to undergo stress-testing — computer simulations to test a bank’s ability with its current levels of capital to withstand a financial crisis. Dodd-Frank also addressed shadow banking, one of the main culprits behind the financial crisis. Standalone investment banks like Bear Stearns and Lehman Brothers operated as shadow banks, meaning that they worked outside of the scope of regular banking regulations. Shadow banks operate like regular banks, and have runs that trigger panic among investors because of a lack of liquidity in case of failure. The failure of shadow banks and subsequent investor panic was one of the main causes of the 2008 financial crisis. Though Dodd-Frank has enabled the Federal Reserve to more easily identify and oversee shadow banks, the practice is still a problem and needs further oversight, Yellen said. Thanks to these reforms, mortgage lending is now safer, Yellen said, but the American economy is still vulnerable in many of the same ways that caused the crisis because of holes in Dodd-Frank. Yellen told the Justice that she views insufficient regulation of shadow banking, “an absence of tools to address rapid credit growth … [and] the loss of [the] ability of the Fed to make emergency loans to non-banks like they did to AIG and Bear Stearns” as vulnerabilities in the U.S. government’s oversight system. To avert another crisis, Yellen said, the United States needs to emulate other countries’ financial stability councils, which stop potentially destructive market bubbles from forming. While the United States has a Financial Stability Oversight Council, established under Dodd-Frank, the council has almost no power because of deregulation. Despite the problems with DoddFrank and deregulation of governmental oversight measures, Yellen does not see a financial crisis in the immediate future.
“I think that if the economy turns down, there will be a lot of bankruptcies that will make the downturn worse. I don’t think that will cause a financial crisis, so I’m not worried about a financial crisis now,” Yellen told the Justice. The event carried a bittersweet undercurrent, though, with the announcement of the Rachel McCulloch Endowed Scholarship, in memory of the late Brandeis economics and IBS professor. McCulloch was the director of IBS and founded its Ph.D program, according to a June 22, 2016 BrandeisNOW article announcing her death. Yellen, a good friend of McCulloch’s from their time as the only two female faculty in Harvard University’s economics department in the early 1970s, extolled McCulloch’s accomplishments when announcing the scholarship. “Rachel was a distinguished economist who made enormous contributions to the field of international economic policy. She weighed in on virtually all of the major trade policy debates of our times, the future of the World Trade Organization, the impact of trade on income inequality” and many other important trade policy decisions, Yellen said. She continued, “Rachel’s work reflected wisdom and good common sense. She knew all the issues in the literature, but also was endowed with an uncommon policy acumen, someone whose advice was sought by policymakers and prominent think tanks, because she got the answers right.” At the event’s conclusion, IBS Dean Kathryn Graddy presented Yellen with the Dean’s Medal in recognition of her contributions to the field of economics. “Professor Yellen has set the highest possible standard for what it means to succeed as an economist. But even more importantly, there is no public figure that I know that has demonstrated more integrity, intelligence, and leadership,” Graddy said. IBS’ 25th anniversary celebration weekend included a variety of panels and workshops geared toward IBS alumni in attendance, such as “Cybersecurity” and “The State of Asset Management,” as well as a celebration in Boston. —Editor’s Note: Justice Editor Natalia Wiater and News Staff Writer Nancy Zhai work for IBS. They did not edit or contribute to this article.
Sexual harassment can create an uncomfortable work environment in any profession, and the medical field is no exception. With the number of women enrolled in United States medical schools exceeding the number of men enrolled for the first time in 2017 and then again in 2018, according to the American Association of Medical Colleges, research is being conducted to learn more about how women are treated in the medical profession. The results of a study on sexual harassment in the medical field, headed by Dr. Linda Pololi, a resident scholar at the Women’s Studies Research Center and distinguished research scientist at the University, were published in the American Journal of Medicine on July 11, according to a Sept. 17 BrandeisNOW article. As the director of the National Initiative on Gender, Culture and Leadership in Medicine and the CultureChange director of the CChange Mentoring and Leadership Institute, Pololi’s work is about improving the overall culture of academic medicine. The BrandeisNOWarticle highlighted one research program her team conducted on sexual harassment experienced by female medical residents. In an interview with the Justice, Pololi said that for ten years her team was doing research on the overall culture of academic medicine between residents and faculty, and included in a survey was a question specifically about sexual harassment. In the past, Pololi only compiled data about sexual harassment, but as part of this study, she analyzed that data. The survey included the statement, “I have personally experienced unwanted sexual comments, attention or advances by a superior or colleagues at my institution.” The residents and faculty had to answer whether this had been true anytime within the last two years, longer ago than the past two years or not at all. According to the study, the data was collected from 1,700 residents via survey at 14 dif-
ferent medical institutions across the United States. 51% of the respondents were women, and Pololi said that only the data of the female residents was analyzed. According to the research paper, 12% of women who were completing general surgery residencies, seven percent of women completing internal medicine residencies and 2% in pediatric residencies reported sexual harassment by their superiors or colleagues. The highest levels of sexual harassment were reported by residents who identified as LGBTQ. Pololi told the Justice that 19% of those who self-identify as LGBTQ have experienced harassment in the workplace. Ultimately, such harassment caused women to be “less energized by work and [have] higher levels of ethical or moral distress,” per the BrandeisNOW article. Pololi told the Justice that it was to be expected that pediatrics saw the lowest levels of sexual harassment among residents because 70% of pediatric faculty are women. By contrast, in internal medicine and surgery, 36% and 19% of faculty are women, respectively. However, the number of women in internal medicine and surgery is on the rise. Between 40 and 45 percent of residents entering these fields are women, Pololi said. Pololi emphasized that by improving the overall culture in academic medicine, which is what C-Change aims to accomplish, the practice of medicine will improve for all. The other authors of this paper were Brandeis’ Senior Research Scientist for C-Change Dr. Robert Brennan, Brandeis’ Senior Research Associate for C-Change Dr. Janet Civian, The Committee of Interns and Residents Policy and Education Initiative Program Director Sandra Shae, Assessment Program Manager at Yale School of Medicine Emma Brennan-Wydra and Professor of Medicine at the Weill Cornell Medical College Dr. Arthur Evans. —Jen Geller
LOVE YOUR BODY
SARAH KATZ/the Justice
The Feminist Majority Leadership Alliance held “Love Your Body Day” on Friday. This event promoted body positivity and radical love, while addressing issues of fat-phobia and the stigmatization of queer bodies.