Who Will Be the Next New York Fed President ?
William Dudley, the influential chair of the New York Federal Reserve, will retire this summer. The recruitment process to select a new New York Fed president has caused outcry and concerns from the politicians and the public due to the lack of racial and gender diversity at the U.S. Central Bank.
The New York Fed has never had a woman or a person of color at its helm, and the Federal Reserve Bank only just last year added its first African American as regional bank president--Raphael W. Bostic of Atlanta. In order for America to build an inclusive and sustainable economy, our nation's premier financial regulator must work to make sure that members from our nations' most vulnerable communities are not left out on the sidelines. Study after study shows that organizations and companies with diverse leadership perform better and are more innovative than entities with homogenous leadership.
The New York Federal Reserve President is perhaps the most important policy-making and regulatory positions that many people have never heard of. After the Federal Reserve Chairman, the New York Federal Reserve President is the second most important economic policymaker in the country. This position has vast influence over the unemployment rate and wages of tens of millions of American workers. With the New York Fed President given a permanent seat on the Federal Open Market Committee, the entity that sets interests rate, the New York Fed president has the power to define the conditions under which the American people can borrow and lend, how we buy our cars and houses, and manage our consumer debt, how much our businesses will have demand for their products, and whether or not the pay for working citizens will be sufficient to provide for our families. This a critical positions that has the power to shape the condition of our prosperity, as well as our poverty.
In addition to this, since the domain of the New York Federal Reserve President includes New York City, this position is given specific regulatory authority over many of the most significant financial institutions in the country and serves as the Fed's eyes and ears on Wall Street. The New York Fed also actually conducts the open market operations through which the Federal Reserve implements monetary policy.
William Dudley has received much praise for his tenure as the New York Fed President and the quest for his successor has been the source of much controversy. The lead pick for this role is John Williams, who currently serves as CEO & President of the San Francisco Federal Reserve Bank. The possible selection of Williams, with a track record of poor forecasting and weak regulation, has caused groups like the Center for Popular Democracy to advocate against his appointment.
The role of the New York Federal Reserve President is not the only vacant spot that needs to be filled within the Federal Reserve System. Out of eight spots, there are currently three vacancies within the Federal Reserve Board of Governors. With America's changing financial landscape, in the midst of the age of Trump, it is crucial that the recruitment process to elect these new members is done efficiently. The Federal Reserve must ensure that people with expertise in the financial services industry from a wide-array of backgrounds are chosen, in order to ensure policies are promoted that encourage an economy that is a level-playing field in which every American has a chance to obtain
the American dream.