Three names Biden is circling for Fed Vice Chair
Tuesday was Lael Brainard’s first day at her new White House gig, but we have the beginnings of a shortlist on who might take her (now) old job as No. 2 at the Federal Reserve. Tobin Marcus, a former adviser to President Joe Biden, highlighted three names that have risen to the top, and MM has confirmed this a serious crop of contenders:
— Karen Dynan, a Harvard professor who spent nearly two decades on staff at the Fed and served as chief economist at Treasury during the Obama administration.
— Dynan’s predecessor at Treasury, Janice Eberly, who’s now an associate dean at Northwestern University’s Kellogg School of Management.
— Seth Carpenter, Morgan Stanley’s global chief economist, a former top monetary policy staffer at the Fed board and one-time acting assistant Treasury secretary for financial markets.
“We believe Dynan and Eberly are the most likely,” Marcus, now a senior U.S. policy and politics strategist at Evercore ISI, wrote in a research note on Tuesday. Both economists are well-known around Democratic policy circles and would represent a “continuity pick” to succeed Brainard, bringing the kind of intellectual heft the White House is looking for.
While Carpenter’s clearly in the running, Marcus writes that his market experience at Morgan Stanley “may not be seen as an unalloyed positive” in a selection and confirmation process that the White House hopes to navigate without a major headache. Still, Carpenter’s allies suggest he might be more desirable to progressives than meets the eye, pointing to his work focusing on the effects of monetary policy on different racial groups as far back as 20 years ago.
Of course, anything can happen. And now that she’s director of the National Economic Council, Brainard will have plenty of opportunity to weigh in on her possible successor.
As our Ben White and Adam Cancryn report, Brainard’s about to become the public face of the White House’s bid to change the narrative on Biden’s handling of the economy: “People who know her say Brainard views the NEC job as a powerful post that could assist in her ultimate goal of serving as either Fed chair or Treasury secretary should Biden or another Democrat win in 2024.”
“While the Fed vice chair post carries influence, it lacks the same scope of authority and — because the central bank is an independent agency — is largely removed from interaction with the White House. The NEC director, by contrast, spends lots of time in the Oval Office conferring directly with the president …”
“That role will include significant air time, with Brainard widely viewed as a commanding voice on both U.S. and international economics.”
“‘Lael will absolutely be on television way more than Brian was for a whole host of reasons, partly because she comes from the Fed,’ the White House adviser said.”
BIG — Our Nick Niedzwiadek: “The National Labor Relations Board on Tuesday wiped away a Trump-era ruling that gave employers wide latitude to require workers to sign confidentiality agreements or waive their right to sue as a condition of severance agreements.”
GENSLER — Rep. Ann Wagner of Missouri, who leads the House Financial Services Committee’s capital markets subcommittee, wrote to SEC Chair Gary Gensler on Friday that the agency’s proposed overhaul of the U.S. stock market — the largest in two decades — would “unnecessarily break well-functioning markets and make it more difficult for [small companies] to go and stay public,” our Declan Harty reports.
ON BLAST — Former FTC Chair Timothy Muris and Bruce Kobayashi, who served as director of the commission’s bureau of economics during the Trump administration, are preemptively blasting FTC Chair Lina Khan’s planned merger guidelines in a new white paper published by the Competitive Enterprise Institute. “In a September 2022 speech, FTC Chair Khan … argues that over the last 40 years the agencies ‘sidestepped controlling precedent and the statutory text’ by ‘administrative fiat.’ Chair Khan’s arguments are without merit.”
Read the full article on Politico.