President Joe Biden on Friday announced plans to appoint former Obama Treasury official Michael Barr to serve as vice chairman for Federal Reserve oversight, a move that would install a key architect of the Dodd- Frank from 2010 as the nation’s top banking regulator.
The announcement comes after Biden’s top candidate, Sarah Bloom Raskin, withdrew her nomination in March, following opposition in the Senate based on her stance on climate change and fears she could discourage banks from lending. to fossil fuel companies. Democratic Sen. Joe Manchin of West Virginia joined Republicans in opposing her, torpedoing her nomination.
In a statement on Friday, Biden praised Barr, who is currently the dean of the University of Michigan’s school of public policy, for his “strong support from all political walks of life.”
Barr previously served in the Obama administration as Assistant Secretary for Financial Institutions under Treasury Secretary Timothy Geithner, and was instrumental in crafting Dodd-Frank, one of the most sweeping pieces of legislation on consumer protection to emerge from the 2008 financial crisis. The banking rule also created the role of vice president for oversight, a position for which Barr is appointed, as Biden noted in a Friday statement.
“Barr has spent his career protecting consumers and, while at the Treasury, was instrumental in the creation of the Consumer Financial Protection Bureau and the position for which I appoint him. He was instrumental in the passage of Dodd-Frank, to ensure that a future financial crisis would not create devastating economic hardship for working families,” Biden said.
Biden has pledged to make the Fed more gender and racially diverse. Several candidates for the Fed Board of Governors, including Jerome Powell for a second term as Fed chairman and Lael Brainard as vice chairman, are still awaiting a Senate Banking Committee vote later this month. Economists Philip Jefferson and Lisa Cook – reportedly the first black woman to serve on the Fed’s board – are also awaiting Senate approval.
Barr’s appointment comes at a crucial time for the Fed as it aims to stage a soft landing for the economy amid the highest inflation in 40 years. Last month, the central bank raised its benchmark interest rate for the first time since 2018 as part of a series of measures aimed at tightening the “easy money” policy that has supported the economy at its worst. of the Covid pandemic, and indicated that it was ready to raise rates at a faster pace.
This story has been updated with additional information.