President Obama’s decision to nominate Merrick Garland to the Supreme Court is all over the news. But it’s hardly the only vacant federal job in Washington. Just look at the Federal Reserve.
There are supposed to be seven members on the Fed’s Board of Governors. But right now, there are only five. President Obama’s nominees for the two vacant slots haven’t been approved by the Senate.
At her press conference after the latest Fed meeting, Chair Janet Yellen said she would like the nominees to get a hearing.
“Congress intended for the Federal Reserve Board to have seven members, and that tends to bring on board people with a wide spectrum of views and experience and perspectives,” she said. “I think that’s valuable, and I would like to see the Senate move forward and consider these nominees so we could operate with a full complement.”
The empty positions on the Board of Governors have shifted the balance of power at the Federal Open Market Committee (FOMC), which sets interest rates. All seven Fed governors are supposed to get a vote on the FOMC, with five votes from presidents of the regional reserve banks. But now, only five governors are voting.
The bank presidents are chosen by local business leaders. They’re not government officials.
“The reserve bank presidents actually get to have significantly more influence this year than was envisioned under the Federal Reserve Act,” said Andrew Levin, a former Fed adviser who now teaches economics at Dartmouth College.
President Obama hasn’t even made a nomination for another vacant position – Vice Chairman for Supervision. That vice chair will supervise the nation’s biggest banks. The position was created under the Dodd-Frank financial reform law.
Senate leaders say they won’t move forward on the other two nominations until the Vice Chairman for Supervision is nominated.