Biden’s Likely Fed Picks Are Boring in a Good Way
(Bloomberg Opinion) -- It appears that President Joe Biden will be finally be moving to fill key vacancies on the Federal Reserve Board. After a long delay, he announced in November that he would renominate Fed chair Jerome Powell and elevate Lael Brainard to vice chair; now he’s reportedly ready to fill the three remaining vacancies — including one that dates back to the beginning of his presidency. Sarah Bloom Raskin, a former Fed board member, is a top contender to return as the chief regulator, joined by fellow economists Lisa Cook and Philip Jefferson.
The Senate would have to confirm all five of the nominees. Powell and Brainard have hearings scheduled for next week; the schedule for the others won’t be set until they are formally nominated, but there’s some early indication that the nominations will encounter relatively little trouble. Nominations that look safe have gone bad before, and Biden can expect plenty of Republican opposition, but overall these seem like the kind of conventional picks that get confirmed without much attention.
The selections, assuming the news reports are correct, are a good example of Biden’s overall approach to filling vacancies. He has been much better than former President Donald Trump at sending up executive branch nominees, but he’s a bit behind the pace of Barack Obama and Bill Clinton, and even farther behind George W. Bush (see Anne Joseph O’Connell’s December recap for a comprehensive look at Biden’s executive branch and judicial nominations). That fits with the Fed nominees as a group; Biden moved slowly on the original vacancy and was somewhat slow to decide on keeping Powell, but he’s apparently moved quickly on the remaining picks, and if they’re confirmed promptly he’ll have exercised the main influence he has on the economy moving into the midterm election year and well before the next presidential election.
For the most part, the nomination process seems to be working well. While there have been several withdrawn choices, notably Neera Tanden for director of the Office of Management and Budget and David Chipman for director of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Biden’s picks have mostly avoided scandal, and the White House appears to be doing a good job of assuring support for nominees before they are launched.
At the same time, Biden has smashed all records on demographic diversity. The latest picks are good examples. Cook would be the 10th woman to serve on the Fed board and would, for the first time, give women a majority of the seven seats. Cook and Jefferson would be the fourth and fifth Black members in the history of the Fed board.
And Biden has also used his selections to fulfill the main, and seemingly contradictory, promises from his campaign: To return to a normal presidency for the nation while at the same time working to achieve a liberal Democratic Party’s policy preferences and priorities. Biden respected a norm that Trump had broken by renominating an incumbent chair, but he also has chosen four other picks who would probably make liberals happy.
Bloom Raskin is a notable example. She has excellent conventional credentials, having already served as a Fed governor during the Obama administration, but she’s also expected to be an aggressive regulator who is particularly concerned with climate, a top concern of the party. Recall that Trump had not only broken the norm of renominating the Fed chair when he chose Powell, who was otherwise a conventional choice, but also had five failed picks despite always having a Republican Senate majority — including such oddball selections as the late Republican politician Herman Cain and Republican pundit Stephen Moore, neither of whom had anything close to conventional qualifications. If Biden’s job was to reassure financial markets that the Federal Reserve would be professional and nonpartisan while also keeping congressional liberals happy, his picks appear to be on track to achieve that.
Whether that will produce good economic policy is a different question, and one on which liberals and conservatives will probably disagree, just as Republicans have been unhappy with many of Biden’s executive branch nominations. That’s a healthy part of partisan polarization.
Presidents owe it to their supporters to fill the government with people who agree with their party’s priorities, but they owe it to the nation to choose from among those who are qualified to do their jobs well — and, I think it’s reasonable to add, to choose people from a wide variety of backgrounds. Biden has hardly been perfect, but this is the kind of thing his administration does pretty well.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Jonathan Bernstein is a Bloomberg Opinion columnist covering politics and policy. He taught political science at the University of Texas at San Antonio and DePauw University and wrote A Plain Blog About Politics.
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