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Obama Plans Fed Nominations 'Soon,' Economic Council Chief Says

Friday, 27 June 2014 01:39 PM

President Barack Obama plans to nominate people soon to fill the two vacancies on the U.S. Federal Reserve Board, said Jeffrey Zients, White House National Economic Council director.

“We’re absolutely committed to filling those spots,” Zients said, appearing on Bloomberg Television’s “Political Capital with Al Hunt,” airing this weekend. “We will nominate folks soon. This is a high priority and we’re working on it.”

Obama would consider a community banker for one of the vacancies on the seven-member board, Zients said.

The president would make those nominations with diminished power to make recess appointments after the Supreme Court in a decision this week cut his authority to make appointments when the Senate is out of session.

Obama is focusing on economic issues affecting voters in the months leading up to the mid-term elections in November when Democrats are trying to hold onto their majority in the Senate and gain seats in the Republican-controlled House.

Zients said he’s optimistic about U.S. growth for the rest of the year. While stopping short of forecasting 4 percent growth, he took issue with an International Monetary Fund forecast of only 2 percent long-term U.S. growth.

“We believe that there’s a lot to do given our position in the global economy,” Zients said. “We are really well positioned in the world economy.”

Part of Zients’s job is to push Congress to act on Obama’s economic agenda, including stalled legislative efforts to pass an immigration overhaul measure and raise the U.S. minimum wage to $10.10 an hour.

‘Need Congress’

“We need Congress to execute on what are job-creating measures,” Zients said. “The president will do everything he can do within his power.”

During a speech today in Minneapolis, Obama argued that his economic priorities are aligned with the interests of middle-income Americans. He blamed Republicans for blocking an increase in the federal minimum wage and an extension of unemployment insurance.

U.S. unemployment has been steady at 6.3 percent the past two months, falling from 6.7 percent earlier this year.

The administration targeted working women this week for its economic message when it hosted a day-long summit in Washington on issues including workplace flexibility and paid maternity leave. The U.S. doesn’t require paid maternity leave for federal or private-sector workers.

Zients said the administration will lean on companies to offer paid leave for new mothers. It will argue there are economic competitiveness advantages in doing so, rather than seeking legislation to compel them to include the benefit.

Community Banker

On the Fed vacancies, Obama has been pressed by lawmakers including Democratic Senator Mark Warner of Virginia to select a community banker for one of the two remaining slots. Fed Chair Janet Yellen has also said she favors including a community banker, following the departure of governors with such experience: Elizabeth Duke and Sarah Bloom Raskin.

Senators Jeff Merkley of Oregon and Elizabeth Warren of Massachusetts wrote Obama a letter on May 28 saying “it is critical that the two remaining nominees for the Board be leaders who possess expertise in financial regulation and have demonstrated a strong commitment to financial reform.”

They suggested candidates who “played important roles” investigating, analyzing, and responding in legislation and regulation to the global financial crisis, and a community banker “with a strong commitment to a level playing field for the Main Street economy.”

Ex-Im Bank

Zients declined to be more specific about when the nominations might be announced. Yellen speaks to the Senate Banking Committee and the House Financial Services committee twice a year, and her next hearing will be sometime in mid-July.

Zients also addressed the issue of whether Congress should reauthorize the U.S. Export-Import Bank, a measure that’s meeting resistance from some House Republicans. He called for the agency’s charter to be renewed.

“The bank’s 80 years old” he said. “It’s been reauthorized 16 times with no drama. We anticipate it will get reauthorized.”

The House Financial Services Committee is considering the reauthorization, which expires Sept. 30. The bank, which provides loan guarantees, loans and insurance to help U.S. exporters, will shut then if it’s not reauthorized.

The White House wants the bank’s charter renewed for five years and its lending cap to be increased to $160 billion from $140 billion. When he was a senator representing Illinois, Obama called for reforms to the bank.

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President Barack Obama plans to nominate people soon to fill the two vacancies on the U.S. Federal Reserve Board, said Jeffrey Zients, White House National Economic Council director.
Obama, Fed, community, banker
Friday, 27 June 2014 01:39 PM
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