Powell's Inflation Legacy Echoes Arthur Burns' Blunders

The legacy of Jerome Powell as Federal Reserve Chair is being compared to that of Arthur Burns, who presided over much of the Great Inflation in the 1970s. The comparison stems from a 64-month streak of above-target inflation under Powell's watch, which has been cited by new Fed Chair Kevin Warsh in speeches.

This count amounts to a claim that the Powell-era Fed allowed inflation momentum to compound, and that the compounding has not stopped. Peterson Institute president Adam Posen said Powell was 'late to the game' in hiking rates in 2022 and 'profoundly mistaken' to cut them multiple times last year.

The pressure on inflation has been sustained by services and energy, with services PCE staying above 3.4% every month from January 2024 through July 2026. Goods inflation also vaulted to 4.76% in May, well beyond a stray shock.