Kevin Drum’s view on Peter Diamond’s nomination is that Richard Shelby is “just being a prick”. Maybe. Certainly that’s the administration’s view. But I worry that the White House is actually underestimating its problem here. What if the right is genuinely trying to kill the nominations in hopes of keeping the Fed paralyzed?
It sounds a bit outlandish. But everyone knows that politicians care about electoral politics. And as Brendan Nyhan says when you break it down “[a]s bizarre as it sounds, there is no bigger issue in American politics right now in terms of the potential effects on future electoral outcomes” than the composition of the Fed’s Open Market Committee. The weird thing is that nobody recognizes that this is the case. But I do. And Brendan Nyhan does. Does Richard Shelby? If he does, how many other Senators do? Just because you’re paranoid don’t mean they’re not after you.
Meanwhile, read Krugman on why Diamond has just the right academic expertise for the job.