Hundreds of economists, including some of the most prominent academics in the U.S., have signed an open letter to President Obama asking him to name Janet Yellen the next head of the Federal Reserve.
The letter, hosted on the Institute for Women’s Policy Research’s site, recommends the 67-year-old Yellen on the basis of her “consistently good judgment” as vice chair of the Fed and in her past roles at the Fed and in Bill Clinton’s White House. “In our opinion, she is the best possible leader for the Federal Reserve Board at this critical time in our nation’s history,” the letter reads.
The letter’s organizer, IWPR president and George Washington University professor Heidi Hartmann, told the Washington Examiner that 356 economists have signed on to the letter since it was published on Sunday, including 250 in the first 24 hours.
Although the letter is framed as an endorsement of Yellen, it will likely also be read as an implicit criticism of Larry Summers, the Harvard professor and former Obama adviser who most observers believe the president will nominate to the Fed’s top post in the upcoming weeks.
One passage of the letter in particular appears intended to dissuade Obama from nominating Summers. It praises Yellen for being “willing to hear multiple points of view” and notes that she “is not beholden to a single interest group, nor to a single industry.” Many of Summers’ critics have cited his arrogance and perceived close ties to Wall Street firms as disqualifications for his nomination.
Hartmann said that Summers had a “reputation” in his stint as chief economist at the World Bank and as president of Harvard and that he is known for “shooting from the hip.” She said that she got the idea to draft the letter when she started reading about Summers being favored for the job and suspected that Summers' candidacy was being driven by a "campaign started by his friends.” She thought that Yellen, not Summers, would be the favorite of a majority of economists, and decided an open letter would be worthwhile after consulting several economist friends. The overwhelming response from economists, in her opinion, shows that Yellen is indeed favored by most economists.
The list of signatories includes a number of the most distinguished economists in the U.S, including Nobel Prize winner Joseph Stiglitz and Michael Woodford of Columbia, who is widely regarded as the leading monetary expert in the world. The Democratic establishment is also well-represented among the letter’s signers. Former Obama adviser Christina Romer and her husband David Romer, Clinton adviser Laura Tyson, Clinton budget director and former Fed vice chair Alice Rivlin, and Clinton adviser Alan Blinder all signed onto the letter.
One signatory, New York University’s Mark Gertler, has written a number of papers on monetary policy with current Fed Chairman Ben Bernanke.