Trump picks monetary expert for no. 2 job at federal reserve

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April 17, 2018 2:09 AM

President Donald Trump continued a sweeping remake of the Federal Reserve’s leadership Monday by nominating Richard Clarida, a Treasury official in the administration of President George W. Bush...

Clarida, a Columbia University economist, is a scholar in monetary policy whose expertise would complement the background of the Fed chairman, Jerome H. Powell, who is not an academically trained economist.

In addition to the nomination of Clarida, which was widely expected, the White House announced that Trump would nominate Michelle Bowman, the Kansas bank commissioner, for a seat on the Fed board to represent community banks. Bowman is a former vice president at Farmers & Drovers Bank in Council Grove, Kansas.

The Fed’s seven-seat Board of Governors is functioning with three members, and the vacancies give Trump the opportunity to put his own stamp on monetary policy.

If confirmed by the Senate, Clarida, 60, would be part of the Fed’s leadership troika, along with Powell and John C. Williams, who will have a seat on the central bank’s policymaking board as the incoming president of the Federal Reserve Bank of New York.

Clarida, 60, served as assistant Treasury secretary for economic policy from 2002 to 2003.

His nomination won quick applause from Fed watchers and some economists, who cast him as a serious thinker unlikely to radically pull the central bank away from its gradual approach to raising interest rates as the economy continues to heal from the financial crisis.

The post to which Clarida was nominated had been vacant since Stanley Fischer, an appointee of President Barack Obama, stepped down in October.

One thing his nomination will not do is bring diversity to the Fed’s leadership team, which is all-male and all-white — a complaint liberal groups made about the New York Fed’s selection of Williams. But the reaction to Clarida’s selection among Fed critics was reserved.

Bowman, 46, would increase gender diversity on a board that includes only one other woman, Lael Brainard, along with Powell and Randal K. Quarles, the Fed’s vice chairman for supervision. Trump has also nominated Marvin Goodfriend, an economist at Carnegie Mellon University, to the board — although his confirmation is in question in the Senate.

This article originally appeared in The New York Times.

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