The Case of the Mysterious Fed Vacancies

Now that I’ve gotten my way on Lael Brainard it’s an ideal time to return to one of my other hobbyhorses—the vacancies on the Federal Reserve Board of Governors. And, indeed, I’ve got a piece in this Sunday’s Washington Post Outlook section that’s available on the web today (why articles from Sunday’s paper are online on Friday is just one of those newspapering mysteries) that returns to this subject:

If there were three simultaneous vacancies on the Supreme Court, Washington would be a war zone, and the volume of direct mail would solve the post office’s financial problems. Not so with the Federal Reserve. When the Fed is discussed in a political context, the talk normally comes from the fringe (as in the Ron Paul fan club’s chants of “End the Fed”). And yet its decisions powerfully affect everyday life in a way that’s rare for a court decision. [...]

As with the Supreme Court, an administration doesn’t have to be content with the Fed it inherits; it can shape the institution through its appointments. Specifically, the president appoints the Fed’s chairman, vice chairman and the five other members of the Board of Governors, who fill seven of the 12 seats on the Open Markets Committee; these appointees are confirmed by the Senate. But for months, the administration has let the board vacancies linger. Failing to replace Justice Stevens, by comparison, would leave a lopsided conservative majority on the Supreme Court. Obama’s supporters would never stand for it. And that’s why it won’t happen.

Getting something done on this front is the most direct, politically tractable way the Obama administration could take action to curb unemployment.