Economics professor Lisa Cook becomes the first African-American woman to join the US Federal Reserve Board. With a wafer-thin majority, she was confirmed by the Senate for the influential office.
Economist Lisa Cook becomes the first African-American woman to serve on the Fed Board.
In January of this year, President Joe Biden nominated economist Lisa Cook for the Federal Reserve (Fed) Board of Governors. After a lengthy process, she cleared the crucial hurdle in the Senate on Tuesday evening, becoming the first black woman on the Fed’s top management body. However, the confirmation came only very narrowly with 51 to 50 votes.
Playoff by Kamala Harris
Because all 50 Republicans voted against Cook and all 50 Democrats for the candidate, a stalemate resulted. The Democrats had previously even delayed the nomination several times until all of their senators were present. Vice President Kamala Harris, who is also ex officio President of the Senate, gave the casting vote.
Republicans said Cook was not qualified enough for the post because she had little experience with monetary policy. In addition, statements before the Banking Committee would have suggested that she would not fight hard enough against high inflation. The top Republican on the Banking Committee, Pat Toomey of Pennsylvania, also accused Cook of wanting to politicize the Fed.
The election is historic and Cook will bring a crucial new perspective to the Fed’s seven-member board of directors, Democratic Banking Committee Chair Sherrod Brown said after the vote. Cook will be a critical voice in the central bank – one has been missing for far too long. The new governor will broaden the range of opinions in the Fed.
Economic Advisor to the Obama Administration
Lisa Cook teaches at Michigan State University and is a renowned economist. She is also one of the few prominent black women in economics. The economist, who speaks six languages, is best known for her research in the fields of economic history and international finance. During the Obama administration, she was on the White House Council of Economic Advisers. A few months ago, Cook was elected to the Chicago Fed’s board of directors.
The economist’s research shows, for example, how racism affects economic development. For example, the toleration of violence against African Americans under the racist Jim Crow laws meant that the innovative power of this population group was slowed down and fewer patents were registered by blacks.
Early in her career, Cook had studied Russia extensively. “Three Essays on External and Internal Credit Markets in Tsarist and Post-Soviet Russia” is the title of her dissertation, published in 1997, in which she analyzes the underdevelopment of the Russian banking system.
In addition to Cook, President Biden had also nominated economics professor Philip Jefferson as Fed governor. The Banking Committee unanimously supported this nomination. Jefferson is likely to become the fourth black man to hold the office. The financial expert Sarah Bloom Raskin, who was also proposed by the President for the Fed, withdrew her application herself because she could not count on the support of all Democrats.
As early as April, the Senate majority confirmed Lael Brainard, who had been proposed by Biden as Fed Vice Chair. She has been a member of the Board of Directors since 2014.
Historical turning point
The Fed is in the midst of a historic turning point. At the beginning of May, in the fight against high inflation, it decided on the largest interest rate hike in 22 years. However, the increase of 0.5 percentage points is unlikely to be enough to get the situation under control.