The president is intent on nominating a white woman, Sarah Bloom Raskin; a black woman, Lisa Cook; and a black man, Philip Jefferson.
If they are confirmed to their posts, the seven-person Fed board would have four women, one black man and two white men – the most diverse team in the Fed’s 108 years of existence.
All three have proven liberal credentials.
Bloom Raskin, 60, is married to Congressman Jamie Raskin – a Democrat representing Maryland in the House.
Sarah Bloom Raskin, 60, is in line to be appointed as vice chair of supervision of the Fed – policing the nation’s biggest banks. She has been a vocal advocate for more regulation to combat climate change
Bloom Raskin is seen with her husband Jamie Raskin, a Democrat congressman for Maryland
She spent four years as a Fed governor before being tapped as a deputy Treasury secretary from 2014 to 2017, and has been nominated to serve as vice chair of supervision – a job created to oversee the nation’s largest banks after the 2008 financial crisis.
She is expected to bring tougher oversight to bear on Wall Street than the Fed’s previous vice chair of supervision, Randal Quarles, the founder of a private investment firm nominated to the post by Donald Trump, who left the Fed at the end of last year.
Currently teaching at Duke University School of Law, Raskin has a particular focus on the risks climate change poses to the financial system and the need for regulators to respond.
The Massachusetts-born economist has also spoken about the economic and financial stability risks tied to climate change, and could, at the Fed, demand changes in how institutions weigh and disclose climate change policies.
‘There is no longer any doubt that climate change will continue to impose deep economic and financial costs on households, communities, businesses, and entire countries,’ she wrote in a September article for Project Syndicate.
‘Many of these risks can still be mitigated, but only if regulators in the United States break some bad habits.’
Raskin said that regulators must ‘ask themselves how their existing instruments can be used to incentivize a rapid, orderly, and just transition away from high-emission and biodiversity-destroying investments.’
She continued: ‘In light of the changing climate’s unpredictable – but clearly intensifying – effects on the economy, US regulators will need to leave their comfort zone and act early before the problem worsens and becomes even more expensive to address.’
And in April, she told a forum at Berkeley that the Fed must be more proactive in combating climate change.
‘We have begun to move toward an economy and society that’s better for us, that provides durable benefits in terms of human health, economic well-being and inclusive prosperity for all our households, businesses and innovators,’ Raskin said.
‘To capture these benefits requires a maneuvering that is not easy but is within the power to imagine.’
She added: ‘This is the treacherous passage we are navigating — trying to neither stay too long in the carbon-based system nor to veer too quickly into resilient systems that have yet to be scaled to provide for the world’s demand.
‘We need (financial regulators) to transition to a net-zero economy in the most stable, least dangerous way possible.’
Joe Biden, seen on Thursday, is intending to create the most diverse board in the history of the Fed, with four women, one black man and two white men
Patrick Toomey, a Republican senator for Pennsylvania, said he was concerned about her approach to determining the most efficient investment strategy.
‘I have serious concerns that she would abuse the Fed’s narrow statutory mandates on monetary policy and banking supervision to have the central bank actively engaged in capital allocation,’ Toomey said in a statement on Thursday night, following news of Raskin’s nomination.
‘Such actions not only threaten both the Fed’s independence and effectiveness, but would also weaken economic growth.’
Biden has also nominated Lisa Cook – who would be the first black woman to ever sit on the Fed’s board.
She worked on the White House’s Council of Economic Advisers during the Obama administration and has held visiting appointments at the National Bureau of Economic Research, the University of Michigan, and the Federal Reserve Banks of New York, Chicago, Minneapolis and Philadelphia.
Georgia-born Cook, currently a professor of economics at Michigan State University, said that her career was inspired by a trip to Africa.
‘It was atop Mount Kilimanjaro that it dawned on Lisa D. Cook that she should go into economics,’ reads her biography on the American Economic Association website.
‘Having spent several hours climbing with a Cambridge-trained economist, Cook, who at the time was in Africa to research her potential philosophy dissertation on the concept of time, began to wonder whether she couldn’t better answer her questions with the tools of economics.’
Lisa Cook, currently a professor at Michigan State, would be the first woman appointed to the Fed’s board
Cook then went on to study at Berkeley and Harvard, competing a dissertation on ‘how the lack of property rights in Tsarist and post-Soviet Russia led to underdevelopment of the banking system’.
Her activism began at a young age, encouraged by her father – a Baptist chaplain at the local hospital.
An uncle and a cousin were college classmates of Martin Luther King Jr. and joined the civil rights movement, and as a child she witnessed her father organizing letter-writing sessions.
‘I organized a protest every single year’ at Spelman College in Atlanta, she said.
Her campaigns included demands that the college divest itself of assets in South Africa, objections to curfew, and protests against the lack of vegan and vegetarian options in the school cafeteria.
Bono of U2 is seen at the White House with George W. Bush, Condoleeza Rice and the Archbishop of Washington, Theodore McCarrick, in 2002. Cook worked with Bono to lobby to write off developing world debt
Cook returned to Africa to work with the government of Rwanda, after the 1994 genocide, and work on poverty reduction.
She also teamed up with Bono of U2 to lobby the White House to cancel developing world debt.
In her official IMF profile, it states: ‘The economist has embraced the issue of race to pursue research at the intersection of the African-American lived experience and macroeconomics.’
She has specialized in investigating how segregation, lynchings, and race riots from 1870–1940 reduced the total number of patents filed.
‘Among her conclusions is that racism and sexism create a huge drag on the world’s largest economy.’
Asked what her dream job would be, she replied: ‘Apart from the field of economics, Commissioner of Major League Baseball, head of the Gates Foundation, or head writer for Saturday Night Live or the Daily Show with Jon Stewart.’
The third nominee is Philip Jefferson, a professor of economics who taught at Columbia University in New York before joining Swarthmore College in Pennsylvania.
Philip Jefferson, a professor at Swarthmore in Pennsylvania, focuses his research on poverty reduction
His recent work, Swarthmore says, looks at ‘the role of education as a buffer against unemployment, the effect of business cycles on poverty rates, and the distribution of income between labor and capital.’
He previously worked as an economist for the Fed’s board of governors, as well as for the New York Fed.
Jefferson said he was inspired as a child to work in finance because they were ‘well dressed’.
Growing up in Washington DC, he decided to focus his research on poverty reduction.
‘We live in a society where the individual and household are on their own,’ he told the American Economic Association.
‘When simple bad luck hits – job loss, a health problem – there’s little to fall back on in terms of wealth or social connections.
‘These type of shocks happen everywhere, but the difference is when you’ve accumulated wealth and a rich social and economic network, you can weather the storm.’
He has also spoken about breaking barriers.
‘In graduate school at the University of Virginia, I was the only African American in the program the entire time there,’ he said in that 2018 interview.
‘It has been a long, lonely road professionally.’