President Biden’s latest nominees to the Federal Reserve — Sarah Bloom Raskin to be vice chair for supervision and economists Lisa Cook and Philip Jefferson to be Fed governors — are highly qualified experts who deserve to be confirmed swiftly.
All three have strong ties to the central bank. Ms. Bloom Raskin, a lawyer, was a Fed governor from 2010 to 2014 and then became deputy treasury secretary. Ms. Cook is a director of the Chicago Fed and has been a regular contributor in recent years to the prestigious Jackson Hole gathering of central bankers and top economic thinkers. She is a professor at Michigan State University. Mr. Jefferson is a former research economist at the Fed who has also had a long career in academia. He is dean of faculty at Davidson College.
Some conservatives have tried to paint these nominees as extremely liberal. There’s no justification for that. It’s telling that former Fed leaders and several prominent economists from the Bush and Trump administrations have praised these candidates.
Ms. Bloom Raskin has come under fire for urging the Fed not to bail out struggling oil and gas companies during the early days of the pandemic. In hindsight, she was right. Gas prices rebounded, and energy firms quickly bounced back. More broadly, she has been a vocal proponent of U.S. regulators, including the Fed, making financial firms consider climate risk moving forward. This is common sense. It won’t shut down lending for production and use of fossil fuels, but it would push banks to start quantifying a huge risk to the financial system.
Ms. Cook would be the first Black woman to serve as a Fed governor in the central bank’s 108-year history. She has spent years studying developing economies, many of which struggled with high inflation. Mr. Jefferson would be only the fourth Black man appointed to the board. The bulk of his research, like Ms. Cook’s, has been about inequality and poverty. It’s mind-boggling that some have attempted to question whether the Fed needs this kind of expertise. Black unemployment has often been double White unemployment for decades, and Americans without college educations are often the last to recover after crises. This is not the economy Americans should accept.
The reality is the Fed’s primary focus is keeping inflation low and getting as many people as possible employed. These nominees understand that. But they also understand there are serious trade-offs involved. If the Fed raises interest rates to combat inflation, that’s likely to lead to some job losses.
To be sure, this trio of nominees should still face tough questioning at their confirmation hearing. Ms. Bloom Raskin needs to clarify — for both the right and left — how extensive she would make climate risk assessments for financial institutions. Similarly, all three should be asked whether they are willing to raise interest rates if inflation remains high, even if that leads to job cuts.
The U.S. economy is facing a highly uncertain time. These three nominees are ready to help lead the Fed and bolster its credibility. The Senate should move quickly to put them in place.
The Washington Post
