Former Federal Reserve Chairwoman Janet Yellen is reportedly
the Biden administration’s top pick for Treasury secretary. Biden is set to
announce his nomination tomorrow.
Other names that were considered for the role include former
Federal Reserve Vice Chair Roger Ferguson, Federal Reserve Gov. Lael Brainard,
and Ariel Investments Co-CEO Mellody Hobson.
If confirmed by the Senate, Yellen would be the first woman
to hold the job. She would play a leading role in shaping economic policy as
the U.S. recovers from the economic turbulence caused by the coronavirus
pandemic.
Yellen is a well-respected economist who was also the first
woman to lead the Federal Reserve from 2014 to 2018. Nominated as Fed chair by
President Barack Obama in 2013, she succeeded Ben Bernanke and was scheduled to
remain a board member until 2024. However, Yellen announced her resignation
from the Federal Reserve Board in 2017 and was the first chair in nearly 40
years to not serve a second term.
Like her predecessor, Yellen was a staunch dove, promoting
monetary policies that usually involve low-interest rates. Much of the research
she performed as an academic economist focused on employment.
Yellen was the first Democrat to chair the Fed in nearly 30
years but stressed the importance of the Fed being independent of political
processes and staying nonpartisan. During the latter part of her term, she
advocated for "gradual rate hikes" believing a sharp rise in rates
could hit the economy with an "adverse shock."
The Treasury secretary is responsible for crucial functions
that help keep the government running, including paying all U.S. bills,
collecting taxes, and managing federal finances. The president looks to the
Treasury secretary as a principal advisor on economic issues as the secretary
makes recommendations about domestic and global economic and tax policy. The
secretary plays a very important part in creating strategies that affect
economic and government financial outlooks for issues the government faces.
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