Joe Biden, the U.S. President-elect, stands ready to elect Janet Yellen as his Treasury Secretary and senior cabinet officer for the American economy as she faces a laborious recovery from the shock of the coronavirus pandemic.
The likely election of Ms. Yellen, 74, will cement her status as one of the leading policymakers of her generation in the United States, having previously served as Federal Reserve Chair, San Francisco Fed President and Chair of the White House Council Economic Advisor under Bill Clinton.
Ms. Yellen recently stepped in front of Lael Brainard, a Fed governor, as Mr. Biden’s leading decision to head the finance department with an announcement expected in the coming days, according to people familiar with the matter.
She declined to speak through a spokesman for the Brookings Institution.
Other candidates for the job included Sarah Bloom Raskin, the former Assistant Secretary of the Treasury; Roger Ferguson, the executive director of the Teachers Insurance and Annuity Association; and Raphael Bostic, the president of the Atlanta Fed. The Biden transition team declined to comment.
Provided she is ratified by the Senate, Ms. Yellen will be the first woman to serve as Treasury Secretary in the institution’s 231-year history. She will replace Steven Mnuchin, Donald Trump’s Treasury Secretary, with the arduous task of accelerating the US recovery with billions of dollars of new stimulus requested by Mr Biden while keeping financial markets stable.
These efforts are likely to involve careful negotiations with Capitol Hill, as Republicans resist sizeable spending hikes and have a close relationship with Fed chairman Jay Powell, especially since Mr Mnuchin recently dismantled several emergency credit facilities at the headquarters bank that worked for their crisis response were crucial.
Mr Biden’s move to elect Ms Yellen for the Treasury Department will give the tiller of the American economy a steady hand and a well-known personality, but her nomination also reflects his desire to fine-tune the demands of the moderate and progressive wings of the Democrats balance party.
As the maneuver for the top position in the Treasury increased in recent weeks, Ms. Yellen was seen as sufficiently left by Ms. Brainard and Mr. Ferguson to please the Liberals, but not quite as progressive as Ms. Raskin.
Ms. Yellen is from New York City. She received her degree in economics from Brown University and her PhD from Yale University, where she was tutored by Nobel Prize winner Joseph Stiglitz.
In addition to her time in the White House, she held various senior positions at the Fed before she was appointed Chairman of the US Federal Reserve by then President Barack Obama in late 2013 and took office in early 2014.
Ms. Yellen led the Fed through a tightening cycle as the central bank tried to normalize its monetary policy in the final stages of the recovery from the financial crisis.
She was seen as one of the more reluctant monetary policy makers, but the rate hikes she witnessed were later deemed overly hawkish by the US Federal Reserve, noting that unemployment could fall to far lower levels before inflation triggered.
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