Biden nominates Federal Reserve Chairman Jerome Powell to 2nd term – Everett Post

Everett

(WASHINGTON) – President Joe Biden announced Monday that he would nominate Federal Reserve Chairman Jerome Powell for a second term of four years in response to new inflation control concerns, and took the opportunity to respond to those who who spoke out against Powell’s nomination.

“As chairman, Jay conducted a landmark review to strengthen the Federal Reserve’s mission to achieve full employment to make great strides now toward that goal, and I believe Jay is the right person to help us through that effort accompany and close them while addressing the threat. “Inflation and what it means for our economies and families,” Biden said at an afternoon event at the White House along with his nominees.

“Now some will undoubtedly wonder why I am re-nominating Jay, even though he was the choice of a Republican predecessor. “Why don’t I vote for a Democrat? Why don’t I take fresh blood or steer the Fed in a different direction? “Said Biden.

“To put it bluntly, at this moment of both the tremendous potential and uncertainty for our economy, we need stability and independence with the Federal Reserve. Jay has demonstrated the independence I value in the Federal Council – in the Fed Chairmanship. Over the past tenure, he has resisted unprecedented political interference while successfully maintaining the institution’s integrity and credibility. It’s just one of the many reasons Jay has received support from across the political spectrum, ”he added before inviting Powell to speak.

Biden also said he would go to Dr. Appoint Lael Brainard, longtime Federal Reserve official and former secretary of the Treasury, as vice chairman of the board of governors of the Federal Reserve System.

“While there is still more to be done, we have made remarkable strides in the past 10 months to get Americans back to work and get our economy going again. This success is testament to the economic agenda I have pursued and the determined actions that the Federal Reserve, chaired by Powell and Dr. Brainard has taken to guide us through the worst downturn in modern American history and put us on the path to recovery, ”he said in a previous statement.

The announcement follows recent questions about whether Biden Powell, a Republican who was nominated as Federal Reserve Chairman in 2017 by then-President Donald Trump, would be nominated again. Powell was first nominated to the Federal Reserve Board of Governors by then-President Barack Obama in 2011, before Trump named him to succeed Janet Yellen, who now serves as Biden’s Treasury Secretary.

“If we are to build on the economic success of this year, we fundamentally need stability and independence with the Federal Reserve – and I have full confidence after their fire process over the past 20 months that Chairman Powell and Dr. Brainard “provide the strong leadership our country needs,” he added in the statement.

Powell and Brainard both made brief remarks at the White House, vowing to work on behalf of all Americans to make the economy more resilient.

“We understand that our choices matter to American families and communities,” said Powell of her work at the Federal Reserve. “I strongly share this mission consciousness and am committed to making these decisions with objectivity and integrity, based on the best available knowledge in the long tradition of monetary independence.”

As the president faced increasing political pressure in recent weeks to shake up leadership by nominating Brainard to succeed Powell, he spoke to both Powell and Brainard about his decision on Friday, according to a source familiar with the matter.

The president spoke regularly with members and stakeholders around the decision, including both progressive and moderate Democrats on Capitol Hill, the source said. Biden recently met with Senator Elizabeth Warren, D-Mass., At the White House to seek her opinion on the decision after Warren publicly described Powell as a “dangerous man” who ran the agency.

“Your file gives me serious concerns. Time and time again you have acted to make our banking system less secure and that makes you a dangerous man at the helm of the Fed, and that is why I will oppose your nomination, “Warren said at a hearing on September 28, Monday oppose Powell’s nomination.

Biden and his team have also been in regular and close consultation with Senator Sherrod Brown, D-Ohio, who chairs the Senate Banking Committee, according to the source. Brown said Monday he would support Powell’s nomination.

Though Brainard has convinced progressives like Warren, who argue it is tougher on banking regulation and climate change, Biden seems to be sending a message reaffirming the central bank’s independence from politics.

“Overall, communications with Mr. Powell as Chairman will remain clear and transparent, and politics will not stray too far from the current course of restraint,” said Rubeela Farooqi, chief economist in the United States at High Frequency Economics, an economic research consultancy, in a statement across from ABC News.

The nomination comes at a critical time for the central bank, whose mandate is to contain inflation and maintain employment growth. Powell has been “deaf” to inflation for the past few months, insisting that price spikes will subside as the pandemic recedes and the supply chain untangles.

Powell oversaw a busy period at the Federal Reserve as it pumped unprecedented stimulus into the financial system in response to the pandemic and is now beginning to take some of that stimulus off the ground. Wall Street had relied on his nomination in order to maintain the continuity of politics in an economically turbulent time.

If both are ratified by the Senate, the White House will have several more seats to fill on the Federal Reserve Board, including the top banking overseer, giving Biden an opportunity to use those picks to reshape the central bank more drastically.

Economists told ABC News they expect swift Senate confirmation for the nominees.

“We believe Biden paired the announcement of the more Democratic-minded candidate Lael Brainard with Republican-themed Jerome Powell to dispel objections from progressive members of the Democratic Party,” said Kathy Bostjancic, US finance economist with Oxford Economics.

Although at least three Democrats have signaled their opposition to Powell’s nomination, at least five Republicans have voiced their support – so it appears that it will be confirmed, but not without several Republicans backing Biden’s candidate. There were nine Democrats, including the then senator. Kamala Harris, who opposed Powell’s nomination in 2018 when he was upheld by the Senate with 84-13 votes.

An adviser to GOP leader Senator Mitch McConnell confirmed that the minority leader is also expected to support Powell’s renomination. Others will likely follow suit.

Republicans are trying to brand Powell as the source of stability necessary for an economy plagued by inflation and supply chain challenges, which they have repeatedly blamed the Democrats for.

“With an economy crippled by COVID-19, and now with the Biden administration’s debilitating policies of supply chain problems and rising inflation, the Federal Reserve needs constancy,” Senator Kevin Cramer, RN.D., said in a statement. “Powell’s appointment is a sign of the persistence that is so important at a time like this. Stability and persistence are in the best interests of American business and I look forward to supporting its endorsement. “

ABC News’s Allison Pecorin contributed to this report.