Lisa Cook shows courage to write Fed history
Many days you may end up worrying about the kind of sarcastic remarks you might encounter in a hothead at the grocery store if you’re wearing — or sometimes not wearing — a mask during the pandemic.
We often find ourselves stuck in a politicized world of zero tolerance and even less than zero analytical thinking or open and honest discussion. My way or the highway, mate.
Given all of this, I have to believe that Michigan State University economist Lisa Cook prepared for her appearance before the Senate Banking, Housing, and Urban Affairs Committee on Thursday with eyes wide open. She is nominated by President Joe Biden to serve on the Federal Reserve Board, which is made up of seven members.
And, frankly, I applaud her courage to come.
Stimulate economic growth
Promoting broad economic opportunities — including for women and racial minorities — and talking about diving into data when making decisions on whether to raise or lower interest rates are entirely sensible approaches, somewhat like wearing a mask inside a grocery store during a pandemic.
On Thursday, however, GOP senators on the banking committee attacked his professional and academic qualifications. According to the opening statement by U.S. Senator Pat Toomey of Pennsylvania, the committee’s ranking Republican, she was accused of engaging in “far-left political advocacy” and “encouraging conspiracies regarding election laws.” of Georgia”.
The role of the Fed is essential to economic growth. Rapidly rising interest rates are a recipe for a recession, for example, at a possible time in the future when the economy is on fragile ground.
The Fed must walk a fine line, raising interest rates to ensure inflation doesn’t spin out of control, but avoid driving up the unemployment rate and slapping a ‘Closed for Business’ sign on economic recovery.
But Cook, as an everyday shopper, was bound to be in trouble. In the real world, you need to be prepared for harsh remarks, hate speech, and name-calling as you speak and live your truth.
Any woman who’s written a newspaper column for almost 30 years can tell you that. Sticks and stones.
Any woman in the workforce knows that in one way or another her credentials, expertise, hard work, long hours, and dedication can easily be called into question. And it’s been even worse for black women because racist smear campaigns are part of too many everyday workplaces.
Learn about the history of the Fed
Cook, who earned a Ph.D. in economics from the University of California at Berkeley, was nominated in January by Biden to the Fed board and must be approved by the Senate.
Biden named three people to the Fed board: Cook; Sarah Bloom Raskin, former Fed and Treasury official; and Phillip Jefferson, economist, dean of the faculty at Davidson College in North Carolina and former Fed researcher.
In the Fed’s 108-year history, nominees Cook and Jefferson would serve as the fourth and fifth black Fed governors.
Cook would be the first black woman to be named to the Fed’s seven-member board.
National Urban League President and CEO Marc Morial told me in a phone interview Friday that he had worked for 15 years to see an African American appointed to the Federal Reserve board.
We can go back to 2006 when Roger Ferguson Jr., who was a vice chairman of the Fed, resigned and ended up being the last black Fed governor for years. Ferguson joined the Fed’s board of directors in 1997, appointed by President Bill Clinton. In 2008, Ferguson became President and CEO of TIAA-CREF and has since retired.
Morial remains hopeful that the “dirty tricks” that are only part of the political landscape will be part of the story, not the end of the story.
He remains confident that Biden’s three nominees for the Federal Reserve board will be endorsed by the Senate with bipartisan support.
Why some had to speak
Morial said it appears Cook has been attacked far more than Jefferson, adding that many of the president’s appointees of color appear to have drawn more attack and scrutiny.
“Dr. Cook is someone we supported very, very early on, believing she was eminently qualified to be a member of the Federal Reserve Board of Governors,” Morial said.
She has strong credentials — including serving on the White House Council of Economic Advisers during the Obama administration — and incredible experience as an economist, he said.
In 2021, Cook was elected to a three-year term on the board of the Federal Reserve Bank of Chicago, a position she will step down if confirmed as Federal Reserve Governor.
Morial began hearing rumors in Washington, DC weeks ago that “she was the victim of a smear campaign or attack campaign against her credentials and research.”
“People kind of warned us that this was going to happen,” he said. “We worked so hard to get her nominated, to get Phillip Jefferson nominated, that we don’t want them thinking that when the going gets tough we’re not going to get up.”
He said it was necessary for him and others to stand up and speak out.
“She dedicated part of her scholarship to the role of race in American economic life,” Morial said.
“And that’s an issue that we’ve urged the Federal Reserve to address,” he said, noting that former Fed Chair Janet Yellen and current Fed Chair Jerome Powell, both testified on this issue before Congress.
“This isn’t new to the Federal Reserve, but it does mean you have someone who brings a level of expertise and lived experiences to the discussion that the Federal Reserve board doesn’t have. had in the past.”
The mission of the Fed is to promote both stable prices, or low levels of inflation, and maximum sustainable employment.
Over the long term, the Fed has failed to adequately address persistent racial disparities in unemployment, according to Professor Darrick Hamilton of The Washington Post.
Hamilton, a professor of urban economics and politics and founding director of the Institute for the Study of Race, Power, and Political Economy at the New School in New York, called the questioning of credentials a Cook of “racist and sexist”.
Morial said tough confirmation hearings were part of the process, but he found Cook’s treatment particularly disturbing.
“The idea that there is something wrong with the study of race in American economic life – that is somehow not worthy, somehow inconsistent with a mandate from the Federal Reserve Board – was troubling. and inaccurate, and also intellectually dishonest.”
Attacks described as “heinous”
Free Press Washington correspondent Todd Spangler detailed the GOP attacks on the Senate committee against Cook.
He wrote that Cook had been “the target of verbal jabs from Republican critics, arguing that his work, much of which has examined the broader economic effects of racism and sexism, does not exhibit the level of expertise necessary for a governor”.
Spangler reported, “Committee chairman Sen. Sherrod Brown, D-Ohio, criticized what he called widespread ‘baseless lies’ about Cook’s preparedness or suggestions that she, or Raskin, would somehow work to radicalize the council. He said the attacks on Cook were “stemmed to discredit a highly respected economist”. ”
Brown called Cook’s attacks “heinous.”
Cook told the committee that she was proud of her academic background.
“I know I’ve been the target of anonymous and false attacks on my academic record,” Cook said.
Following:Michigan State Professor Appointed to Fed Board Defends Against GOP Attacks
Following:MSU Economist Lisa Cook Appointed to Fed Board: Here’s How She Could Make an Impact
What fans are saying about Cook
Some of Cook’s supporters took to Twitter and elsewhere.
“I know Lisa Cook and I don’t understand the attacks,” Diane Swonk, chief economist at accounting firm Grant Thornton, told me in an email Friday.
Nearly 400 economists signed a statement in support of Cook and Jefferson, both former presidents of the National Economic Association, founded in 1969 as the Caucus of Black Economists.
MSU President Samuel Stanley noted in a larger email letter to the MSU community that “Spartans were very proud to see MSU economist and professor Lisa D. Cook , appointed to the Board of Governors of the Federal Reserve System by President Joe Biden.
Stanley called Cook “an outstanding economist and leader whose appointment highlights the excellence of our spartan faculty”.
He called her “a prominent advocate for diversity of voice and scholarship in economics.”
Stanley noted that he was honored in 2020 to be invited to host former Fed Chairman Yellen – now US Treasury Secretary – as a guest speaker for the American Economics Summer Training Program. Association, which was then organized by MSU under the direction of Cook.
The Sadie Collective – a non-profit that tackles the “problem of pipeline and pathway for black women in economics, finance and politics” – held a virtual watch party on Thursday to attend the historic nomination hearing.
When I first wrote about Cook’s nomination, I said his voice needed to be heard in the room. Now, thanks to her courage and willingness to show herself, it might even happen one day.