Biden’s Fed vice chair search narrows as top tier seen emerging

The White House is narrowing its search for a nominee to become the next Federal Reserve vice chair, intending to swiftly replace Lael Brainard, who became President Joe Biden’s top economic adviser this week.

A top tier of candidates is taking shape led by Harvard University professor Karen Dynan and Northwestern University professor Janice Eberly, in no particular order, with Chicago Fed President Austan Goolsbee, San Francisco Fed President Mary Daly and Morgan Stanley Chief Global Economist Seth Carpenter also in serious contention, according to people familiar with the search, speaking on condition of anonymity as the process unfolds.

Other names beyond those are expected to circulate or be floated to the White House, including Fed governors Lisa Cook and Philip Jefferson, but they are considered longer shots than the others, some of the people said. Cook and Jefferson joined the board last year.

The White House wants the process to conclude relatively soon, the people said, with an announcement possible in the coming weeks. Whoever the president nominates must be confirmed by the U.S. Senate.

A White House official declined to respond to specific names and candidates and said only that the administration is looking at a highly diverse group of world class economists and will move quickly to nominate someone. The official spoke on condition of anonymity as the process continues.

Eberly, Goolsbee and Carpenter declined to comment. Dynan and Daly did not respond to requests for comment.

Filling the high-profile position is particularly urgent as the central bank continues its battle against inflation and as the 2024 presidential campaign takes shape amid anxieties about the nation’s economic future.

The White House declined comment on the candidates or timing. The people who said the search had narrowed also cautioned that deliberations continue and no decision has been made. The Wall Street Journal previously reported the interest in Goolsbee, a fixture in Democratic circles who was a fierce defender of Biden before taking his current role.

Brainard left the Fed officially on Monday and started Tuesday as Biden’s National Economic Council director.

Biden recruited Brainard — a one-time candidate for Fed chair and Treasury secretary — away from the central bank to head up the National Economic Council after the departure of Brian Deese. The president also named Jared Bernstein as his incoming chair of the Council of Economic Advisers. He replaces Cecilia Rouse, who is scheduled to return to Princeton University.

Biden has been urged to pick a Latino candidate to succeed Brainard, with 34 lawmakers signing a letter last week calling for such a trailblazing appointment. The nominee, however, is not expected to be a Latino, two of the people said.

Tobin Marcus, an analyst for Evercore ISI who once worked for Biden, said in a research note this week that he believed Dynan and Eberly, and to a lesser extent Carpenter, to be the frontrunners.