The Senate has confirmed the first Black woman ever to sit on the Federal Reserve Board of Governors in a historic and critical vote as the nation’s central bank fights to control runaway inflation.
Lisa Cook, an economist at Michigan State University who has also worked at Harvard and had visiting appointments at four of the 12 regional Federal Reserve banks, was approved on a party line vote of the full Senate late Tuesday. Unlike the confirmation of Judge Ketanji Brown Jackson to the Supreme Court, which had the bipartisan support to avoid a tie breaking vote by Vice President Kamala Harris, Cook needed Harris’ vote to squeak across the finish line by a final tally of 51-50 in the evenly-divided Senate.
But much of Cook’s confirmation process and the political climate around it, though it received far less media attention, mirrors what Jackson went through earlier this year. Jackson was the first Black woman nominated to the court, at a time it was preparing to take up issues like the right to an abortion and how far states can go in enacting gun control laws. Likewise, Cook was the first Black woman nominated to the Federal Reserve Board, also with critical timing.
The Fed is trying to tame inflation, currently at its highest levels since the early ‘80s, in part by jacking up interest rates, which they hope will slow economic activity by limiting consumers’ and businesses’ ability to borrow. But some economists fear that the Fed’s rate hikes will have harsher impacts on Black consumers than other groups. At the same time, the Fed has to weigh the impact that inaction, or acting too timidly, could have on the economy as well.
All four current Fed governors are white and three are Republicans; two are women. There are still two vacant seats. Having a Black woman join the board for the first time during such a crisis could bring a new perspective to the current monetary policy discussions.
But as with Jackson, Senate Republicans attacked Cook’s qualifications, despite an education that includes undergraduate degrees from Spelman College and Oxford University and a doctorate from Berkeley, and a lengthy professional resume that includes serving on the White House Council of Economic Advisors and being on faculty at Harvard’s Kennedy School of Government.
Republican Sen. Bill Hagerty of Tennessee told Cook during this month’s Banking Committee hearing that her background was impressive but didn’t seem related to the Fed’s mission. “If I look at your list of publications and your speeches, it seems more like social science than it does economics and monetary policy,” he said.
Her supporters point out that Fed Chairman Jerome Powell has a juris doctor, not an advanced degree in economics, but he has been confirmed by the Senate twice. And they say other criticism of Cook being too radical is based on a distortion of past statements, including those she made on the issue of reparations for Black Americans.
That attack is pegged to a 2020 interview with an economics website in which Cook said the nation must still reckon with how the institution of slavery benefited the rest of society. She said that reparation proposals should “be taken seriously.”
Cook replaces former Treasury Secretary Janet Yellen, whose board seat has been vacant since 2018. Her term expires in 2024.
Economist Philip Jefferson has also been nominated to the Fed board by President Joe Biden. If confirmed, he would be the fifth Black man to serve in that capacity.