President Biden will nominate Sarah Bloom Raskin as the Federal Reserve’s top Wall Street cop, a Biden administration official has said, one of three nominees unveiled for critical open seats on the central bank’s board of governors. .
Why is this important: It’s Biden’s biggest mark yet on the influential economic body that takes center stage as the country grapples with inflation rising at the fastest rate in decades and a labor market in recovery.
- Biden also tapped Lisa Cook, an economist who teaches at Michigan State University and previously served on the Council of Economic Advisers during the Obama administration, and Philip Jefferson of Davidson College, a former Fed economist.
- If confirmed, Cook would be the first black woman to serve on the Fed’s seven-member board, while Jefferson would be the fourth black man.
Between the lines: Raskin, Biden’s pick for Vice Chairman of Fed Oversight, is likely to appease Democrats who want someone in the role who is tougher on financial regulation and speaks out on issues like climate change.
- Raskin, a Duke University law professor who served as Fed governor from 2010 to 2014 before joining the Treasury Department under the Obama administration, has been candid about regulators who have called out the risks climate change poses. weigh on the financial system.
- If confirmed, Raskin could influence how banks and other financial institutions assess and disclose their climate risks. Republican senators signaled this week that they would be skeptical of his climate views and may oppose his nomination entirely.
The bottom line: Biden’s picks for the Fed board come at a crucial time for the central bank as it struggles to rein in inflation that has been more persistent than initially thought.
- With the new additions, there could be more focus on issues the Fed has recently begun to be more outspoken about, Fed watchers say — including climate change and a more inclusive definition of full employment that takes into account indicators such as the black unemployment rate.
And after: Fed Chairman Jerome Powell, tipped for a second term by Biden in November, and Lael Brainard, Biden’s vice presidential pick, both faced confirmation hearings this week and are on the right track. way for votes in the Senate.