US President Joe Biden has announced the appointment of two people to key positions at the Federal Reserve, including a new Fed governor and economist Philip Jefferson as vice chairman.
In a White House statement on May 12, President Biden said he would propose the name of Federal Reserve Governor Philip Jefferson to be the next vice chairman of the US central bank, replacing Lael Brainard, who resigned in February. . The US President said that Adriana Kugler, former chief economist at the US Labor Department, was his choice for one of the vacant seats on the Fed’s Board of Governors. He will also re-appoint Governor Fed Chair Lisa Cook for a full term.
President Biden said, “These candidates understand that this job is not partisan, but plays an important role in finding maximum employment, maintaining price stability, and overseeing our nation’s many financial institutions.”
Nominations will go to Congress, where candidates require the vote of the full Senate before they can take their respective positions at the Federal Reserve. Although Democrats hold a slim majority in the Senate, partisanship could be a factor in pushing Biden’s nomination. In a May 12 statement, House Financial Services Committee Chairman Patrick McHenry, a Republican, described the candidates as “seasoned economists” and said lawmakers would take them into account when considering their allegations.
If confirmed by the Senate, Jefferson would serve as vice chairman of the Federal Reserve for part of his current term as governor until 2036 and Kugler for a 14-year term likely to expire in 2037. If Cook is not confirmed by Congress, his current term will expire in 2024.
Leadership at the Federal Reserve will likely influence how the US government considers handling cryptocurrencies and blockchain technology, particularly regarding the potential issuance of a central bank digital currency. While proponents of a federally issued CBDC have suggested it could help cement the US dollar’s position as the world’s reserve currency, some have attacked the digital dollar over privacy concerns.
In Florida, Governor Ron DeSantis signed a ban on CBDCs in the state, claiming the technology was about “controlling and controlling the behavior of Americans.” The North Carolina House of Representatives passed a similar bill on May 3 that prohibits payments in CBDCs and does not allow the Fed to engage the state in any digital dollar pilots.
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