University News

Yellen ’67 confirmed as Federal Reserve chair

First woman to head nation’s central bank will take office next month

By
University News Editor
Tuesday, January 7, 2014

Updated: Jan. 22 at 2:39 a.m.

The Senate confirmed Janet Yellen ’67 as chair of the Federal Reserve Jan. 6, making her the first woman to lead the nation’s central bank.

Yellen, who was nominated by President Obama in October, will take office Feb. 1 after serving as the Fed’s vice chair since 2010, national news outlets reported. The last Fed chair nominated by a Democratic president was Paul Volcker, who was selected by President Jimmy Carter in 1979, the New York Times reported.

The Senate voted to approve Yellen 56 to 26. Several senators missed the vote due to weather-induced travel difficulties, according to multiple news outlets.

Unlike fellow alum Secretary of Labor Thomas Perez ’83, whose confirmation vote last July split exactly along party lines, Yellen received the backing of 11 Republicans in addition to all the Democrats present. But the vote to confirm Yellen was still the closest ever for a nominee to the Fed chairmanship, a supposedly nonpartisan and independent regulatory position, the Times reported.

Yellen headed the Federal Reserve Bank of San Francisco for six years before serving as Fed vice chair under Ben Bernanke, the outgoing chairman. She also chaired President Bill Clinton’s Council of Economic Advisers from February 1997 to August 1999.

Yellen has argued forcefully for a more activist role for the central bank in reducing unemployment and promoting economic growth. She has given her unwavering support to its current bond-buying program, designed to lower long-term interest rates in order to spur investment and hiring.

The question of how quickly to wind down these aggressive monetary policies has been the subject of fierce debate for several months and will likely dominate the beginning of Yellen’s tenure as Fed chair.

Democrats praised Yellen as an effective regulator unafraid of using monetary policy to aid the nation’s tenuous economic recovery.

But Sen. Chuck Grassley, R-Iowa, struck a tone representative of many of his Republican colleagues when he criticized Yellen for supporting the Fed’s “easy-money policies,” the Wall Street Journal reported. Many Republicans have expressed concern that such policies could lead to asset-price bubbles and too much inflation.

“No one can deny that the risks are real and could be devastating” if the bond-buying program continues much longer, Grassley told the Associated Press.

Obama released a statement Monday calling Yellen “a fierce champion” who will protect Americans.

“I am confident that Janet will stand up for American workers, protect consumers, foster the stability of our financial system and help keep our economy growing for years to come,” Obama said in the statement.

  • upupperclassman

    Does the news writer know that Yellen graduated from Brown University by attending college at Pembroke?