President Joe Biden is reshaping his economic team as the U.S. economy faces headwinds from high inflation, climbing interest rates and slowing growth. To lead his economic policy, Biden has appointed Federal Reserve Vice Chair Lael Brainard as the director of the National Economic Council.
Brainard, 61, brings a deep understanding of the domestic and global economy into the White House’s inner circle. She was a crucial negotiator during Europe’s debt crisis, and has been a force in Washington for over two decades, after working as an economist in the Obama and Clinton administrations before she joined the Fed.
At the central bank, Brainard has amassed an unusually large portfolio, including when she was the only Democrat on the Fed board through much of the Trump administration. The Fed's emergency response to the pandemic was also heavily reliant on her. She earned a reputation for taking a hard stance against Wall Street and rejecting attempts to reduce regulation of large financial institutions. The Federal policy often receives unanimous votes. Brainard dissented from her colleagues on roughly 20 regulatory issues, thus setting her apart. She played a vital role in the area of monetary policy, collaborating closely with Powell to institute the Fed's unprecedented reaction to the COVID-19 pandemic and combat inflation.
Coming to the White House is a significant moment for Brainard, the Biden administration, the Federal Reserve, and the overall economy. The Federal Reserve is continuing its battle against inflation, and the possibility of a recession during the Biden Administration looms due to its aggressive rate increase efforts. It is yet to be determined if the economy is heading for a recession or if it can narrowly escape one, thus preventing the labor market, which had an impressive growth in January, from facing a large number of job losses.
It is anticipated that Jared Bernstein, a current member of the Council of Economic Advisers, will be appointed as the new chair, replacing Cecilia Rouse, who is leaving the post. Bernstein has been appointed to the Council of Economic Advisers in place of Cecilia Rouse, who will be resuming her professorship duties at Princeton.
Brainard has been appointed to guide Biden in his discussions with House Republicans concerning the contentious and challenging process of increasing the U.S. debt ceiling sometime this year. The White House has been firm in its stance, refusing to negotiate regarding the essential funding, whereas the GOP has insisted that only by decreasing spending could they gain its approval.
0. “Biden Reshapes Economic Team Ahead of Debt-Ceiling Fight, Re-Election Campaign” The Wall Street Journal, 14 Feb. 2023, https://www.wsj.com/articles/biden-reshapes-economic-team-ahead-of-debt-ceiling-fight-re-election-campaign-badd76f8
1. “Is Joe Biden’s Pick for Top Economic Adviser Good or Bad for Crypto?” CryptoPotato, 14 Feb. 2023, https://cryptopotato.com/is-joe-bidens-pick-for-top-economic-adviser-good-or-bad-for-crypto/
2. “Biden picks Fed's Lael Brainard for National Economic Council” Axios, 14 Feb. 2023, https://www.axios.com/2023/02/14/biden-lael-brainard-national-economic-council
3. “Who is Lael Brainard, Biden's new top economics adviser?” The Washington Post, 14 Feb. 2023, https://www.washingtonpost.com/us-policy/2023/02/13/lael-brainard-who-is
4. “Fed’s Lael Brainard moves to White House” The Washington Post, 14 Feb. 2023, https://www.washingtonpost.com/business/2023/02/13/brainard-fed-white-house
5. “Biden taps Fed's Brainard, Bernstein for top economic jobs as part of White House reshuffle” CNBC, 14 Feb. 2023, https://www.cnbc.com/2023/02/14/brainard-bernstein-tapped-for-top-white-house-economic-posts-as-biden-shakes-up-team.html