Treasury's Brainard Said Likely to Be Fed Nominee

Tuesday, 05 Nov 2013 10:06 AM

 

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Lael Brainard, the U.S. Treasury Department’s top international official, is likely to be nominated to the Federal Reserve Board, according to a person familiar with the decision who requested anonymity.

Brainard is likely to be picked along with the renomination of Fed Governor Jerome Powell, the person said. Brainard will step down from her current post on Nov. 8, according to a Treasury aide who requested anonymity to discuss personnel matters.

Brainard and Janet Yellen, the Obama administration’s nominee for Fed chairman to replace Ben S. Bernanke after his term expires Jan. 31, both worked as economic advisers in the late 1990s under President Bill Clinton. In the past three years, they have represented the U.S. at meetings of global finance officials.

In addition to the seat left open by Bernanke, President Barack Obama has two other vacancies to fill on the Fed board. Elizabeth Duke, a Virginia banker, resigned as a Fed governor on Aug. 31, and Obama has nominated Sarah Bloom Raskin, another governor, to be the U.S. Treasury’s first female deputy secretary.

Point Person

As undersecretary for international affairs since 2010, Brainard, 51, has been the department’s point person pushing Europe and China to accelerate changes in their economies, from more flexible exchange rates to fiscal policies that stimulate growth. At the Group of 20 and other meetings of global finance ministers, Brainard was the highest-ranking U.S. official after the Treasury secretary.

Jamie Smith, the White House deputy press secretary, declined to comment last night when contacted by Bloomberg News.

Before a meeting of the Group of 20 economies in mid-July, Brainard said the U.S. was coming to the talks at its strongest position in four years and urged countries to take action to spur growth.

“If you look across the global landscape, there are reasons to be concerned that some parts of the world aren’t doing enough to bolster domestic demand,” Brainard said, naming Europe as one of the laggards.

Deputy Director

She was a deputy director of the National Economic Council under Clinton and involved in the U.S. response to the Mexican and Asian financial crises of the 1990s and China’s access to the World Trade Organization. She was a top adviser at Group of Eight summit meetings during the Clinton administration.

Brainard was a senior fellow and then a vice president at the Brookings Institution in Washington from 2001 to 2009. She taught applied economics at the Massachusetts Institute of Technology in the early 1990s and was a business analyst at McKinsey and Co. in her first years out of college in the early 1980s.

Brainard was chosen as undersecretary by Obama in March 2009 and wasn’t confirmed by the Senate for more than a year after that because of questions about her taxes.

She was approved by a 78-19 vote after revising documents she submitted to the Senate Finance Committee to reflect late payments of property taxes, according to a report by the committee’s staff. The staff also took issue with how Brainard deducted her home office expenses and completed paperwork for household employees.

Brainard, who has masters and doctoral degrees in economics from Harvard University, is married to Kurt Campbell, a former assistant secretary of state for East Asian and Pacific affairs.

Brainard was born in Hamburg, Germany. Her father was a Cold War-era U.S. diplomat, and she spent much of her childhood in Germany and Communist Poland, an experience she has said “did profoundly influence my view about how America leads in the world.”

© Copyright 2014 Bloomberg News. All rights reserved.

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