Sherrod Brown, Ohio's raspy voiced, tasseled-hair senior U.S. Senator, is receiving plaudits from progressives and others for his leadership in the vanguard of Washington officials who are championing the appointment of Janet Yellen, the Federal Reserve Board's current vice chairman, instead of Larry Summers, a former favorite of Presidents Clinton and Obama, to succeed Ben Bernanke as Fed chairman when he steps down early next year.
Summer's withdraw from consideration over the weekend prevented more harsh clashes from Democrats and Republicans alike over his confirmation fight to lead the nation's central bank whose charge includes both monetary policy and the workforce.
Brown, who won a second term last year in a bitter campaign against Ohio's first-term state treasurer that saw $40 million spent to defeat him, is credited with organizing a letter in support of Fed vice chair Janet Yellen, 67 years old, that eventually was signed by more than one-third of the Democratic caucus.
Along with Sens. Elizabeth Warren of Massachusetts and Jeff Merkley of Oregon, Brown, a professional politician who came to congress after multiple terms in the Ohio House and as Secretary of State, is credited with being unafraid to challenge the policies of the Wall Street wing of the party. Had Summers, whose history in Washington includes appointments by President Clinton and then President Obama, not withdrawn his name, his hearings would have been "ugly, with liberals probing Summers on his mistakes on deregulation and Republicans denouncing his activities under President Obama," according to Robert Borosage of America's Future.
In a letter to the White House that Brown was prominently associated with, Yellen backers said she "has an impeccable resume." Her vita includes member of the President’s Council of Economic Advisers, Chief Executive of a Regional Federal Reserve Bank and Vice Chair of the Board of Governors.
"At a time of persistently high national unemployment, the next Chairman must focus on returning our economy to full employment. Just as you read ten constituent letters every day to remain connected to the everyday lives of American families, the next Chairman must also recognize that the unemployment numbers are, in Governor Yellen’s words, 'not just statistics'. In her time on the Board, Governor Yellen has done just that. Our nation badly needs a Chairman with a solid record as a bank regulator," the letter the senators wrote noted.
A spokesman for Sen. Brown declined to comment for this story on the withdraw of Summers.
Yellen became Vice Chair of the Board of Governors of the Federal Reserve System on October 4, 2010, for a four-year term ending October 4, 2014. Dr. Yellen simultaneously began a 14-year term as a member of the Board that will expire January 31, 2024, according to the Federal Reserve.
In a statement Sunday from the president, he accepted the Summers' decision. "Larry was a critical member of my team as we faced down the worst economic crisis since the Great Depression, and it was in no small part because of his expertise, wisdom and leadership that we wrestled the economy back to growth and made the kind of progress we are seeing today," Obama said.
In the face of opposition from Sen. Brown and others, Larry Summers referenced the letter to the White House in his withdraw statement: "I have reluctantly concluded that any possible confirmation process for me would be acrimonious and would not serve the interests of the Federal Reserve, the administration or ultimately, the interests of the nation's ongoing economic recovery," Summers wrote.
Now that critics don't have Larry Summer to kick around anymore, the possible field Obama can choose from to be Fed head includes another possible candidate: Donald Kohn, 70 years of age, a former Fed vice chair.
With the end of Bernanke's term arriving on Jan. 31, 2014, Obama is expected to announce a nominee for the Fed chairmanship by the end of September.
David Jones, chief economist at DMJ Advisors and the author of several books on the Fed, said he saw Yellen's selection as a virtual certainty, according to the Huffington Post. "There is a strong view that making a woman Fed chair is an important step," Jones said. "There is no question that her experience qualifies her for the role."
Yellen has supported Bernanke's use of the Fed's traditional tool of short-term interest rates but also non-traditional tools designed to help the economy, Julie Pace and Martin Crutsinger wrote, including bond purchases and guidance to investors about the likely direction of rates. Yellen has also been recognized for seeing in 2005 the looming mortgage meltdown and for her consensus style of leadership and for her commitment to job growth. Her reputation as a top bank regulator, combined with her experience as vice chair, is also strong reasons Brown and others want President Obama to pick her.
The fact that 350 economists signed a letter to Obama calling on him to nominate Yellen, who if chosen by the president would become the first woman to lead the Fed, also doesn't hurt.
Subscribe. It's ALWAYS free. Send news or tips to firstname.lastname@example.org. join me on Google+, Pinterest or Twitter, or watch my YouTube videos.