Two of the nominees – Lisa Cook and Phillip Jefferson — are African Americans. Another nominee is Sarah Bloom Raskin, a former Fed and Treasury official. The nominees would have to be confirmed by the Senate and would compete the Fed’s seven-member board, ABC News reported.
The appointments would come as the nation’s central bank is reportedly facing a delicate matter of possibly raising its benchmark interest rate to help fight inflation. Observers have stated an interest rate rise could come by as soon as March, potentially triggering a series of more such hikes this year.
On the nominee front, Biden’s selection would add a big boost diversity at the Fed his picks are approved. According to ABC News, “Cook and Jefferson would be just the fourth and fifth Black governors in the Fed’s 108-year history. And for the first time, most of the board would consist of female appointees.”
“This group will bring much needed expertise, judgement and leadership to the Federal Reserve while at the same time bringing a diversity of thought and perspective never seen before on the Board of Governors,” Biden said in a statement Friday per ABC News.
As for Cook, “she has been a professor of economics and international relations at Michigan State since 2005. She was a staff economist on the White House Council of Economic Advisers from 2011 to 2012 and an adviser to the Biden-Harris transition team on the Fed and bank regulatory policy,” per ABC News.
If chosen, she would be first black woman to become a Fed board member.
Jefferson is an economist, dean of faculty at Davidson College in North Carolina and a former Fed researcher, ABC News reported. The outlet reported Raskin was on the Fed’s seven-member board from 2010 to 2014. She was chosen by former President Barack Obama to serve as deputy Treasury secretary.
Cook, Raskin, and Jefferson as Fed governors would vote on interest-rate policy decisions at the eight meetings each year of the Fed’s policymaking committee. That committee includes includes the 12 regional Fed bank presidents.
William Michael Cunningham, an economist who runs Washington, D.C.-based Creative Investment Research, says the nominees are good as they add to the diversity of life experience on the board. He added this is critical due to the disproportionate impact of the pandemic on the Black community.
He said the only downside may be the “Clarence Thomas” effect: simply nominating a Black person to serve may not be enough to change Black economic fortunes for the better.”
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