by Christopher Rugaber
WASHINGTON (AP) – President Joe Biden on Friday announced the nomination of three people to the Federal Reserve’s board of governors, including former Fed and Treasury officials Sarah Bloom Ruskin and Lisa Cook, for the top regulatory slot. Will be Black woman to serve on the board of the Fed.
Biden also nominated Philip Jefferson, an economist, dean of faculty at Davidson College in North Carolina, and a former Fed researcher. Three nominees, who must be confirmed by the Senate, will fill the Fed’s seven-member board.
They will join the Fed in particularly challenging times, in which the central bank will undertake the delicate task of raising its benchmark interest rate to try to curb high inflation, without reducing its recovery from the pandemic’s slowdown. On Wednesday, the government said that inflation reached a four-decade high in December.
If approved, Biden’s choice would significantly increase the Fed’s diversity. Cook and Jefferson would be just the fourth and fifth black governors in the Fed’s 108-year history. And for the first time, the majority of the board will have women appointees.
In late November, Biden nominated Jerome Powell for a second four-year term as Fed chairman and elected Fed board member Lyle Brainard as vice president.
“This group will bring much-needed expertise, judgment and leadership to the Federal Reserve, as well as bring a diversity of views and perspective never before seen across the Board of Governors,” Biden said in a statement Friday.
Ruskin’s nomination to the post of Fed vice chair for oversight – the nation’s top bank regulator – will be welcomed by progressive senators and advocacy groups, who see him as likely to take a tougher approach to bank regulation, which Trump The bank is likely to take a tougher approach to regulation than its appointee Randall Quarles. down last month. He is also seen as a man committed to incorporating climate change considerations into the oversight of the Fed’s banks. For this reason, however, he has already opposed some Republican senators.
Ruskin, 60, a Harvard-trained attorney, previously served on the Fed’s seven-member board from 2010 to 2014. President Barack Obama then selected her for the job of Deputy Treasury Secretary, No. 2 in the department.
As Fed governors, Ruskin, Cook and Jefferson will vote on interest-rate policy decisions at eight meetings each year of the Fed’s policymaking committee, which also includes 12 regional Fed Bank presidents.
Ruskin’s first term as Fed governor came after his work as Maryland’s commissioner of financial regulation, when he oversaw the state’s banks during the 2008 financial crisis.
Kathleen Murphy, CEO of the Massachusetts Bankers Association, worked with Ruskin during Ruskin’s tenure as Maryland’s banking regulator from 2007 to 2010. Murphy headed the Maryland Bankers group at the time. Murphy said the state’s financial industry regarded him as a “strong regulator but an impartial regulator.”
“She’s always had a very collaborative approach,” Murphy said. “She wanted to make sure all voices were on the table when making a decision.”
Still, Ruskin is likely to come under fire from critics for his progressive views on climate change and the oil and gas industry. Two years ago, in an opinion column in The New York Times, he criticized the Fed’s willingness to lend to oil and gas companies as part of its efforts to bolster the financial sector in the depths of the pandemic recession.
“The decisions the Fed makes on our behalf should build a stronger economy with more jobs in innovative industries – not support and prosper the dead,” Ruskin wrote, referring to oil and gas providers.
On Thursday, Sen. Pat Tommy, the top Republican on the Senate Banking Committee, criticized Ruskin for “blatantly advocating that the Fed allocate capital by denying this unfavorable sector.”
Ruskin is married to Representative Jamie Ruskin, a liberal Maryland Democrat who gained wide visibility as a member of the House Judiciary Committee over the impeachment charges against President Donald Trump.
Cook has been Professor of Economics and International Relations at Michigan State since 2005. She was also a staff economist on the White House Economic Advisory Council from 2011 to 2012 and an advisor to the Biden-Harris transition team on the Fed and the Bank. regulatory policy.
Cook is known for his research on the impact of racial violence on African-American invention and innovation. In a 2013 paper she wrote that racially motivated violence, undermining the rule of law and threatening personal safety, decreased patent awards to black Americans by 15% annually between 1882 and 1940 – a loss. What he found outpaced even the broader US economy.
In an interview in October, Cook said that despite encouragement from prominent economists such as Milton Friedman and George Akerloff, he struggled for years to get the paper published. Major economics journals, she said, generally don’t deal with “patents, or economic history, or anything related to African-Americans.”
Cook has also been an advocate of black women in economics, a profession that is notably less diverse than other social sciences. In 2019, she co-authored a column in The New York Times stating that “economics is neither a welcoming nor supportive profession for women” and “particularly antithetical to black women.” “
To combat those problems, Cook has spent time mentoring young black women in economics, directing a summer program run by the American Economic Association, and won an award for mentoring in 2019.
Growing up in a working-class family in Washington, DC, Jefferson has focused his research on poverty and monetary policy, according to an interview with the American Economic Association. In a 2005 paper, he concluded that the benefits of a warming economy from a reduction in unemployment among low-skilled workers outweighed the costs, including the risk that companies would adopt automation once labor became scarce.
AP writer Josh Bok in Washington contributed to this report.
This story has been updated to correct the first name of the nominee Jefferson. It’s Philip, not Philip.