President Biden on Tuesday named Lael Brainard, a top official at the Federal Reserve, as the new director of the National Economic Council as part of a reshuffling of responsibilities on his economic team.
Brainard replaces Brian Deese, who has led the National Economic Council since the start of the Biden administration. Deese’s upcoming departure was announced earlier this month.
Brainard’s appointment was announced in conjunction with news that Jared Bernstein will lead the Council of Economic Advisers, a group he was already part of. The former head of that group, Cecilia Rouse, is set to return to her post at Princeton University this spring.
Biden also announced promotions for Bharat Ramamurti, Heather Boushey and Joelle Gamble to new roles on his economic advisory team.
“This team will be committed to implementing that strategy, while managing the transition of our historic economic recovery to steady and stable growth,” Biden said in a statement announcing the changes. “They will work tirelessly to ensure every American enjoys a fair return for their work and an equal chance to get ahead, and that our businesses can thrive and outcompete the rest of the world. Let’s finish the job.”
Brainard will be just the second woman to chair the National Economic Council since it was established in 1993. The first was Laura Tyson, who led the council from 1995-1996.
Her appointment will be cheered by liberals in particular, who have long supported Brainard for her tough approach to Wall Street and her views on the relationship between climate change and the economy. Some progressives had advocated for Biden to nominate Brainard to chair the Federal Reserve, though Biden opted to renominate Jerome Powell for another term.
Brainard was the third woman to serve as Fed vice chair since the modern central bank system was established in 1914, following Alice Rivlin and former Fed Chair and current Treasury Secretary Janet Yellen.
She has been aligned with Powell on the bank’s efforts to fight inflation while preventing a strong U.S. economy from slowing into recession. She supported keeping the Fed’s baseline interest rate range near zero through all of 2021, but pivoted along with Powell in favor of rate hikes as inflation steamed well ahead of the bank’s expectations late last year.
Taming inflation will be a central focus for both Brainard and Berstein in their new roles. While Biden officials have maintained inflation is cooling and there is no need to worry about a possible recession, federal data released this week has shown the issue is not going away.
Consumer prices rose 0.5 percent in January and 6.4 percent annually, according to Labor Department’s consumer price index released Tuesday, a jump in inflation which could encourage the Federal Reserve to further raise interest rates.
Core inflation, which excludes volatile food and energy prices, came in at 0.4 percent on a month-to-month basis and 5.6 percent annually.
Brainard and Bernstein are also likely to be involved in talks to raise the debt ceiling ahead of a looming June deadline. The White House has been adamant that Congress should vote to raise the debt ceiling without conditions about spending cuts attached, and officials have warned that the prospect of a default could send the economy spiraling.
Some Republicans have argued the debt ceiling should not be raised without commitments to curb government spending and further balance the federal budget.
Source: The Hill
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