History is in the making as the nation’s first-ever black president has nominated the first-ever woman to chair the Federal Reserve in the central bank’s 100 years of existence. The media is having a heyday with the nomination of Janet Yellen, second guessing whether she will excel at the task or not compared to her predecessors.
It’s not as if Yellen is under-qualified for the position. Her resume reads like someone who was groomed for the important job as head watchdog of the nation’s fiscal and monetary policy.
According to a timeline published by The Wall Street Journal, Yellen hails from Brooklyn, N.Y., holds a bachelor’s degree in economics from Brown University and a Ph.D. in economics from Yale University. Her husband, George Akerlof, won the Nobel Prize in economics in 2001, and her son Robert Akerlof is an economist at the University of Warwick in the United Kingdom.
Among her many qualifications, Yellen has been an assistant professor at Harvard University in the department of economics, has served as an economist for the Federal Reserve Board of Governors, division of international finance, served as a Fed governor and as president of the Federal Reserve Bank of San Francisco. Between 1997 and 1999 Yellen served as chairwoman of the White House Council of Economic Advisors under President Bill Clinton.
Since Oct. 4, 2010, she has been vice chairwoman of the Federal Reserve.
So with all these qualifications what is all the squawking about? Her economic policy, of course. The consensus seems to be that she’s going to keep on keeping on with the current policy popularized (depending on your point of view) by current Fed Chairman Ben Bernanke, which includes more quantitative easing at the cost of $85 billion a month.
USA Today remarked that she has “an outstanding track record with forecasts and a willingness to cut against the grain.”
In an op/ed column in The Boston Globe, former president of the Federal Reserve Bank of Boston Cathy E. Minehan said Yellen’s nomination “should be welcomed by our nation…She is also a terrific listener and consensus builder and is adept at that new required skill of Fed chairmen, communication.”
Minehan also noted that if confirmed, Yellen would face the thankless task of handling a “high-wire act of keeping the economy moving with less and less monetary support without creating financial volatility that works to damage prospects for growth….And getting that done against the backdrop of the political stalemate in Washington is an even more daunting task.”
While our elected officials are busy playing a game of political “tag you’re it,” ordinary people can’t pay their bills (like their mortgages, utility bills and gasoline bills). Yellen will have it tough enough. The job description includes steering the nation’s interest rates which in turn affects the stock market, the mortgage market, the real estate market, whether people can afford to buy homes or stay in their existing homes. As well as who may lose a job and go into foreclosure. A lot of responsibility goes along with this job.
Some commentators are already saying that if confirmed, Yellen will become the second most powerful woman in the U.S. With the bowing out of her only real competition — Lawrence Summers, former director of President Barack Obama’s National Economic Council — Yellen has a good chance of getting the nod from the Senate.
Frankly, with such a dark cloud of public distrust floating over Capitol Hill, putting Yellen in charge of the nation’s checkbook may turn out to be one of the most prudent moves President Obama has made in his second term. She certainly can’t do any worse than her predecessors.
History will let us know how it all turns out…if the Senate can get its collective act together long enough to confirm her.
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