(Reuters) – A highly critical think tank of Federal Reserve Chairman Jerome Powell’s banking regulatory record on Monday released a scathing and complementary assessment of his four-year tenure, highlighting the competing considerations as US President Joe Biden ponders whether to rename him.
Better Markets’ 23,000-word report, released ahead of the Fed’s annual Jackson Hole conference on central banks, now held virtually, highlights Powell’s “very poor” record on banking regulation and its “inexplicably slow” response to climate-related risks.
He also praises his “exemplary” handling of former President Donald Trump’s attacks on the independence of the US central bank, and takes note of his swift and aggressive action to protect the economy from the impact of the coronavirus pandemic. and the benefits of the Powell-led Fed. a new emphasis on boosting the labor market.
Entitled “Should Federal Reserve Chairman Jay Powell Be Re-elected,” it never answers his own question. Dennis Kelleher, who runs what The New York Times has called “the costumed cousin of Occupy Wall Street,” says it’s on purpose.
Kelleher, who was on the transition team for then-President-elect Biden and Vice-President-elect Kamala Harris, said the goal was to “push for a very strong process. , substantial, complete and thorough “. Biden will have to make a decision one way or the other in the coming months, as Powell’s term ends in February.
Progressive voices calling on Biden to replace Powell generally focus on what they see as an unwarranted easing of banking regulation under Fed chief watch, a view Kelleher shares, and what they see as a less than proactive approach to climate change compared to other global central banks.
But they also blame the Fed for exacerbating wealth inequalities by increasing the value of assets like stocks. On this point, the Kelleher report is significantly less critical, noting that the Powell-led Fed’s pledge not to tighten monetary policy until the economy reaches maximum employment should in the long run help close the wealth gap.
With no clear timeline from Team Biden on an announcement for the Fed’s top job, Powell’s supporters and critics began to fill the void and make their preferences public. Republican Senator Steve Daines of Montana last week became the first member of the panel that will consider the nomination to seek the re-appointment of Powell.
Report by Ann Saphir in San Francisco; Editing by Paul Simao