“She will leave a hole,” said Laura Rosner-Warburton, a senior economist at MacroPolicy Perspectives. “She was a leading voice on international economics, macroeconomics, on inequality, climate change — she spanned a lot of areas.”
Economists on Wall Street and in academia had begun to speculate on Tuesday about who could replace Ms. Brainard. Some suggested that a current Fed governor — perhaps Lisa Cook or Philip Jefferson, both former academic economists — could be elevated into the job.
There was also speculation that one of the Fed’s 12 presidents from across the country could be picked, such as Mary C. Daly, the president of the Federal Reserve Bank of San Francisco. Academic economists, such as Janice Eberly from Northwestern University or Karen Dynan from Harvard University, could also be in the running.
Ms. Brainard, 61, has been vice chair at the Fed since May and was a governor at the central bank’s board in Washington starting in 2014. Before that, she was an official at the Treasury and worked in the Clinton White House.
While it may shift the dynamic at the Fed, her appointment also underscores how Mr. Biden has elevated climate change into the heart of the White House’s economic policymaking.
In her Fed tenure, Ms. Brainard gained notice for her speeches and statements calling for regulators to treat climate change as a significant risk to the financial system. In 2020, the Fed for the first time assessed climate change risks in detail in a financial stability report. “Climate change poses important risks to financial stability,” she wrote at the time, and addressing such concerns “is vitally important.”
Mr. Bernstein serves on the Council of Economic Advisers with Heather Boushey, who Mr. Biden said Tuesday would also become the chief economist to his so-called Invest in America cabinet. Mr. Bernstein did not need Senate confirmation for that appointment. Ascending to the chairmanship would force him to take a difficult road in the Senate, where Mr. Biden’s party commands a slim 51-to-49 majority when accounting for three independent senators who typically vote with Democrats. Ms. Rouse won confirmation two years ago in a landslide, 95 to 4, becoming the first Black chair of the Council of Economic Advisers.
