On Friday, US President Joe Biden chose Philip Jefferson for the number two job at the Federal Reserve. This job has been open since February, when Lael Brainard left for the White House.
If approved, he would take over as vice chair at a very important time for the Fed. Since last year, the Fed has raised interest rates 10 times as it tries to deal with inflation that is too high.
The White House said in a statement that Biden also chose Adriana Kugler, who is the executive head of the World Bank, to be a Federal Reserve governor. He also renominated Lisa Cook to serve a full 14-year term as a governor at the bank.
“I am confident that these nominees will help build on the historically strong economic recovery we’ve had under my administration,” Biden said, adding that he thought the nominees knew the bipartisan nature of the job.
“I am deeply honored by the trust that President Biden and Vice President (Kamala) Harris have shown me by nominating me,” Jefferson said in prepared remarks at a conference in California on Friday.
First Hispanic to run the Fed
If Kugler is approved, he will be the first Hispanic-American to serve on the Fed’s governing body. He would be in charge of setting the benchmark interest rate, which is a very important job.
Jefferson has been a Fed governor since the Senate confirmed him last year. If he were to become Fed vice-chair, he would be the second Black man to do so. This would show that the Biden administration is committed to making the US central bank’s management more diverse.
The Senate, which is run by Democrats, must now approve the three nominees put forward by the Biden government.
By nominating Jefferson and Kugler and renominating Cook, who is black, “President Biden is sending a message that the hopes and dreams of Black and Latino Americans are central to the promise of America,” said US Democratic Senator Bob Menendez in a tweet.
“To put it simply, we are seeing history happen right now,” he said.
If approved, the nominees will fill the remaining spots on the Fed’s rate-setting committee, which has been working with only 11 members instead of the usual 12 since Brainard left the Fed to become the director of the National Economic Council.
Patrick McHenry, who is in charge of the House Financial Services Committee and is a Republican, said in a statement, “These nominees are experienced economists who can make a real difference in the work of the Federal Reserve Board.”
“If they are confirmed for these jobs, I urge them to be completely fair and keep their eyes on bringing down inflation,” he said.
“In no way should partisan politics affect the decisions of the Federal Reserve Board,” he added.