Sen. Menendez Efforts Urging President Biden to Nominate a Latino American to the Federal Reserve Board of Governors
Happy Thursday morning.
With a high-profile opening at the Federal Reserve, key Senate Democrats are lining up behind a long-running effort by Sen. Bob Menendez (D-N.J.) – making the U.S. central bank more diverse by selecting its first Hispanic governor.
The Wall Street Journal reported on Wednesday that the White House was considering Austan Goolsbee, president of the Chicago Fed, to be the Federal Reserve’s next vice chair. Goolsbee would replace Lael Brainard, who will take over as director of the National Economic Council later this month. Several potential new Fed nominees were floated, and the business pubs suggested several more. Most of these potential picks are eminently qualified, but they’re also white, which is the issue.
Keep this reporting in perspective: No nomination has been made yet, and Biden’s White House has previously floated nominees for regulatory positionsbefore changing course weeks or months later.
But here’s the interesting dynamic: Multiple Democrats on the Senate Banking Committee told us Wednesday night that they want to see the White House prioritize diversity with its pick to replace Brainard, including the panel’s chair, Sen. Sherrod Brown (D-Ohio).
“I’ve worked for a very diverse Fed,” Brown told us. Brown pointed to two successful nominations that cleared the Senate last year – Fed Govs. Lisa Cook and Philip Jefferson – and said both Black economists exemplified a “diversity of thought” by prioritizing the Fed’s dual mandates of price stability and maximum employment.
“I’ve spoken to the White House about all those things – diversity of thought, diversity of candidates,” Brown said, adding: “There’s never been a Latino on the Fed board.”
There’s early evidence this push by Menendez will attract support from more than just the Banking Committee’s progressives. Sen. Mark Warner (D-Va.) told us he had enjoyed working with Goolsbee in the past and said he’s a “smart economist.”
But Warner also noted that “Sen. Menendez has a very good point – that we don’t have a single Latino member on the Fed.”
The White House faces similar pressure on replacing Labor Secretary Marty Walsh when he leaves that post as expected. AAPI lawmakers want to see an Asian American pol tapped for that Cabinet position, while other Democrats have been pushing their own potential candidates.
The lack of Hispanic representation inside the Fed is a topic that Menendez has been hammering for years now. Last night, we asked whether the New Jersey Democrat’s preference for a Hispanic Fed governor would be enough to vote against Goolsbee if the White House nominated him.
Menendez replied: “I’ve been making it very clear to the administration. They need to give me someone to vote for, and that somebody should be Hispanic.”
Sen. Ben Ray Luján (D-N.M) told us he would “absolutely” stand behind Menendez’s push for a Hispanic Fed governor:
“When we look at the buying power, market power, where pensions sit, decisions that are made every day – I do not understand why qualified Hispanics who have been doing this work, who have the experience, have not been considered or have not been elevated.”