WASHINGTON—The Democratic architects of a major overhaul of US financial regulation a decade ago called on President Joe Biden to reappoint Fed Chair Jerome Powell for a second term, dismissing arguments that he has been weak on regulatory issues. .
Christopher Dodd and former Representative Barney Frank wrote in an opinion article in The Hill newspaper that their signature changes to the Dodd–Frank law under Powell were “not a major attack, and nothing in Powell’s performance refutes this claim.” Doesn’t support the original framework that we’ve put in place.”
The 2010 law was the main legislative reform to bail out the 2007–2009 financial crisis, and included trading restrictions on banks, tighter risk management and efforts to ensure that taxpayers would never again have to bail out large financial institutions. .
Many of those rules were relaxed during Powell’s tenure, prompting some Biden supporters to encourage a change in Fed leadership.
Powell’s term ends in February. The Biden administration has not announced a timetable for deciding whether to reappoint or replace him.
Dodd and Frank noted that if Biden wants to take a different regulatory approach, he could appoint a new Fed vice president for regulation and supervision, appointing Donald Trump and replacing current vice president Randall Quarles.
He argued that more important, Powell’s approach to monetary policy – by reducing inflation risk in favor of encouraging stronger job gains – would help Biden achieve his macroeconomic goals. As a Republican, Powell’s voice on that issue will be of particular importance.
“For a moderate Democrat, Powell provides … a much greater shield against conservative accusations of fiscal irresponsibility than similar actions coming from a newly appointed liberal,” he wrote, as well as “those of Assurance for those who are really concerned about rising prices.”
by Howard Schneider
This News Originally From – The Epoch Times