I’ve seen a lot made of the fact that Peter Baker’s long article on Obama and the economy doesn’t talk about housing, foreclosures, or HAMP. But that’s not all it doesn’t talk about! It doesn’t talk about the Federal Reserve, and the President’s powers to appoint its Chairman and Board of Governors.
But this crew—the Federal Reserve System in all its agencies—is the arm of the federal government that has primary responsibility for fighting recessions. The greatest power the president has to influence short-term economic performance is his ability to staff the Fed. Obama acted swiftly to reappoint Ben Bernanke as Chairman and acted very slowly to nominate anyone to serve on the Board of Governors. This has to be part of any discussion of the President’s efforts to deal with the economy. Did nobody ever bring it to his attention that he should fill these vacancies?