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Tag: federal reserve board
Biden's Federal  Reserve Nominees Come Under Right-Wing Attack

Biden's Federal  Reserve Nominees Come Under Right-Wing Attack

Washington (AFP) - Though set up as an institution operating above the partisan fray in Washington, the Federal Reserve has again become a political football, with Republicans and business groups attacking President Joe Biden's nominees to serve on the central bank's board.

Biden last month announced a slate of candidates who would at long last fill all the seats of the seven-member board, and include the first Black woman to hold the position since the Fed was founded 108 years ago.

If all three are confirmed, the majority of the board members would be women for the first time, and most would be named by a Democratic president.

Critics say the choices threaten to inject a political slant into the Fed's management of the economy just as it pivots to fighting inflation, which threatens to undermine the recovery from the Covid-19 pandemic.

But economists and Fed watchers say the criticisms are unfounded and in some cases racially motivated.

The Senate Banking Committee is scheduled to hold a hearing Thursday to consider the nominations of Lisa Cook, an economics professor at Michigan State University, who would be the first African American woman to serve as Fed governor.

Lawmakers will also consider Philip Jefferson, of Davidson College, who would be the fourth Black man to serve on the body.

For the powerful post of Fed vice chair for supervision, which oversees the nation's banks, Biden tapped Sarah Bloom Raskin.

She previously served as Fed governor and in a senior role at the Treasury Department under former president Barack Obama, as well as the top state bank regulator in Maryland. She is married to Rep. Jamie Raskin (D-MD).

Biden also renominated Jerome Powell to a second term as Fed chair, and named current board member Lael Brainard to serve as vice chair. They are awaiting Senate confirmation.

Race And Climate

The White House said the picks "will bring long overdue diversity to the leadership of the Federal Reserve."

But Senator Pat Toomey, the ranking Republican on the Senate Banking Committee, complained about a lack of "diversity" among nominees to the board, which does not have anyone from the energy industry.

His complaints, echoed by the US Chamber of Commerce, center on Raskin, charging she would be overly aggressive in focusing on banks' roles in fighting climate change.

She has called for the Fed to ensure financial institutions take climate risks into consideration, something Powell also endorses.

Toomey's concerns are the mirror image of opposition expressed by some Democrats to Powell's nomination for a second term at the helm of the central bank, who argue he is not focused enough on climate change.

Racially Motivated Attacks?

Conservative political commentator George Will has accused the Fed of being politicized, writing in a column that Cook's "peer-reviewed academic writings pertinent to monetary policy are, to be polite, thin."

However other board members, including Powell, are not trained economists.

"I just don't understand the backlash," said Diane Swonk, chief economist at Grant Thornton. "It just really seems to be pretty biased."

Cook and Jefferson have researched inequality in the labor market, a topic Powell has repeatedly highlighted as important, since the Fed works to ensure the benefits of economic expansions reach all parts of society.

Swonk called Cook a "phenomenal" candidate.

Biden's nominees "bring enormous depth to the Fed at a time when" the central bank is "finally acknowledging inequality and what it costs us," she told AFP.

Amid the attacks, the National Economic Association issued a statement supporting Cook and Jefferson, both past presidents of the organization, that called them "uniquely and exceptionally qualified."

Republican Support

David Wessel, senior fellow at The Brookings Institution and a longtime Fed watcher, dismissed the criticisms about qualifications, saying they impose a "double standard" on Cook.

"The whole point of having a seven-member Federal Reserve Board... is to represent a cross section of America," he told AFP.

"Nobody wants to have a Federal Reserve Board... that's all white guys who went to the same three Ivy League schools."

The nominees also have won Republican support.

Kevin Hassett, a top economist under former president Donald Trump, praised Jefferson as "exactly the type of economist who should be at the Fed at this difficult time."

Representative Patrick McHenry, the top Republican on the House Financial Services committee, which oversees the Fed in the lower chamber of Congress, highlighted Raskin's "long history of distinguished government service."

Trump Withdraws Moore Fed Nomination With Abrupt Tweet

Trump Withdraws Moore Fed Nomination With Abrupt Tweet

Reprinted with permission from Alternet.

It’s a sad story of two nominees to the Federal Reserve Board of Governors who were never really nominees at all.

President Donald Trump announced that CNN analyst Stephen Moore and former presidential candidate Herman Cain would be his next picks for Fed. Both are personal supporters of the president and, not coincidentally, they are both right-wing hacks with wacky — and often blatantly wrong — views of economics. Both also had disturbing personal histories, which appears to be what tanked both of their nominations — nominations that were never even officially sent to the Senate.

The tanking of Moore’s nomination on Thursday was particularly humiliating for a man Trump supposedly considers a friend. Early in the day, Bloomberg News published a story about Moore projecting confidence about his chances for confirmation.

“I’m all in,” Moore had told the outlet.

“My biggest ally is the president,” he said. “He’s full speed ahead.”

Just about two hours later, Trump ended his hopes for the role on Twitter.

Of course, the writing had been on the wall for days, and there was always reason to believe his nomination would be a struggle. In the past week, senators were openly talking about his dwindling chances, citing his misogynistic comments, racism, and dubious financial history — including unpaid taxes and alimony.

Cain, too, has a damaging history — there have been at least four different allegations of sexual harassment against him. Cain retained a small measure of his dignity by at least appearing to withdrawn voluntarily from consideration, rather than being directly undercut by the president.

Somewhat unfortunately, though, it didn’t seem that Moore’s and Cain’s rank partisanship and unfounded economic beliefs would have been enough to disqualify them on their own. This raises concerns about whether Trump may be able to successfully put forward other charlatans for the Fed if they happen to have less baggage.

 

The Very Strange Case Of Stephen Moore

The Very Strange Case Of Stephen Moore

What can you say about Stephen Moore? That his economic views tend toward the nutty, and his research is a slop job? That his juvenile fear of females borders on the pathetic — and that he didn’t find them too embarrassing to air? That he’s Donald Trump’s pick to serve on the Federal Reserve Board of Governors? Yes, but we repeat ourselves.

Fed board members have been liberal, and they have been conservative. Many no doubt harbored sexist views. But there was never a nominee who wrote things like, “No one seems to care much that coed sports is doing irreparable harm to the psyche of America’s little boys.”

He doesn’t like grown-up coed play, either. He called letting women join men in pickup games a “travesty.” (Just wondering what business it is of his whether men choose to play sports with women.)

Something must have happened to the poor lad. Did some girl beat him at pingpong in the third grade?

Were he a star economist, we might avert our eyes from the strangeness of his social scribbles. But Moore’s economic musings are off the wall as well. He’s supported a return to the gold standard. He predicted that George W. Bush’s policies would lead to an economic golden age and that inflation would soar under Barack Obama. Wrong and wrong.

Then there’s his “scholarship.” I used to cite studies from The Heritage Foundation when the conservative think tank was producing solid research. Then Heritage sold its soul to the partisan swamp, out of which Moore rose as Heritage’s chief economist.

Under that title, he submitted a column in 2014 so shot through with error that The Kansas City Star vowed to never publish him again.

His thesis was that low taxes produce explosive job growth. As evidence, Moore wrote that “over the last five years,” no-income-tax Texas gained 1 million jobs while high-tax California lost jobs. For the same reasons, Florida added hundreds of thousands of jobs while New York lost jobs.

Whoops. He wasn’t using numbers from the previous five years but from December 2007 to 2012. But even those numbers were wrong. In fact, Texas gained not a million but 497,400 jobs. Florida actually lost 461,500 jobs during that period — while New York gained 75,900 jobs.

“He seemed OK with a correction,” Miriam Pepper, then the Star’s editorial page editor, told me. “But as we dug deeper he got more difficult, then hostile.” She added: “I’m surprised Heritage isn’t embarrassed.”

There are smart fabricators and dumb ones. Only the dimwitted would try to pass off stats that any boy — or girl — with basic computer skills could have countered with a visit to the Bureau of Labor Statistics site.

In his personal finances, Moore is a double deadbeat. He owes more than $75,000 in unpaid taxes. And a court held him in contempt for not paying his ex-wife $300,000 as part of a divorce agreement.

This is the man who brooded: “What are the implications of a society in which women earn more than men? We don’t really know, but it could be disruptive to family stability. If men aren’t the breadwinners, will women regard them as economically expendable?”

Moore the breadwinner is also Moore the stud. Allison Moore’s 2010 divorce complaint noted that he had created a Match.com account and had an affair. She says he told her and their children, “I have two women, and what’s really bad is when they fight over you.”

Add Moore’s economic ignorance to his arrested development and you have a highly flawed character. May the Federal Reserve Board — and the public it serves — be spared his presence.

Follow Froma Harrop on Twitter @FromaHarrop. She can be reached at fharrop@gmail.com. To find out more about Froma Harrop and read features by other Creators writers and cartoonists, visit the Creators webpage at www.creators.com.

IMAGE: Stephen Moore of the Heritage Foundation, Trump nominee to the Federal Reserve Board.