Politicsfederal reservePoliticsJanet Yellen

House Democratic Women To Obama: Nominate Janet Yellen For Fed Chair

Majority Of House Democratic Women Tell Obama To Nominate Janet Yellen For Fed Chair
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Washington Bureau Chief, HuffPost

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Senior Reporter, HuffPost

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WASHINGTON -- A majority of the Democratic women serving in the House of Representatives are urging President Barack Obama to nominate Janet Yellen as chair of the Federal Reserve, putting additional pressure on the president to reject economist Larry Summers, who is rumored to be the frontrunner.

Thirty-eight of the 62 Democratic women in the House have signed on to a letter circulated by Rep. Maxine Waters (D-Calif.), saying that Yellen, currently the Fed vice chair, would be the "best choice" to lead the institution. It comes on the same day that Obama met with Democrats on Capitol Hill and heard from many members who were frustrated that Summers is reportedly the president's top choice for the job.

"Doctor Yellen has demonstrated a unique understanding of the impact of the Federal Reserve's policies on the middle class, with a critical focus on the balance of the mandate between stable prices and low unemployment," the letter reads. "During the subprime bubble, at a time when many economists were optimistic about unprecedented growth in the economy, she saw the bubble for what it was and predicted disaster in the banking system."

Long before serving as Obama's chief economic adviser, Summers worked in the Clinton administration as a protege of Treasury Secretary Bob Rubin, where he helped lead the effort to deregulate Wall Street. Many Yellen supporters are worried that Summers would follow in the footsteps of his mentor and dial back the Fed's efforts to lower unemployment in order to appease the bond market. Yellen, meanwhile, argues that protecting bondholders is not the Fed's only job.

Summers also served as president of Harvard University, but he resigned in 2006 after he suggested that women may be inherently less talented at math and science than men are.

If chosen, Yellen would be the first female Fed chair.

During the Wednesday meeting with House Democrats, Rep. Ed Perlmutter (D-Colo.) walked up to the microphone and simply said, "Larry Summers. Bad Choice." According to a Democratic staffer, he received applause from his colleagues. The president became agitated and rose to Summers' defense.

The feminist group Ultraviolet has called on Obama to choose Yellen, saying Summers is "a man known for his offensive and callous opinions on women." The National Organization for Women also endorsed Yellen last week in a statement criticizing Summers' record on bank regulation.

"Janet Yellen was one of the few in the Fed system to sound the alarm on subprime mortgages in 2007, while Lawrence Summers shut down Brooksley Born’s effort to crack down on derivatives,” said NOW President Terry O’Neill. “It’s not hard to connect the dots: lax regulation contributed to the financial meltdown that ushered in the ‘Great Recession’ -- with devastating impacts on women, who have less savings to fall back on because of an enduring gender wage gap. Lawrence Summers can't be trusted to understand the everyday economic problems women face."

House Minority Leader Nancy Pelosi (D-Calif.) has said it would be "great" if a woman were to be named Fed chair, but she has not explicitly come out and endorsed Yellen.

Roughly a third of Senate Democrats have signed on to a separate letter endorsing Yellen. Obama will need Senate Democrats' support to get his Fed pick confirmed.

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Before You Go

Economic Predictions That Were Blatantly Wrong (Or Have Blatantly Yet To Come True)
Paul Ryan: QE2 Risks Inflation(01 of12)
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Back in 2010, Republican Vice Presidential candidate Paul Ryan explained that the Federal Reserves plan to purchase $600 billion worth of securities -- known as QE2 -- was little more than "sugar-high economics" that risked rising inflation and weakening the dollar. But instead the opposite took place. According to Bloomberg:
"Since that prediction by Ryan, who has been chosen by presumptive Republican presidential nominee Mitt Romney to be his running mate, the dollar has risen against major currencies and inflation has stayed below the Fed's goal of 2 percent."
 (credit:AP)
Christina Romer: Unemployment Will Remain Below 8%(02 of12)
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In early January of 2009, Christina Romer, economic adviser to then President-elect Barack Obama, made a prediction: massive government stimulus on the order that would eventually be passed by Congress would keep unemployment below 8 percent, reports The Washington Post. Without it, unemployment could reach as high as 9 percent.In July 2012, unemployment edged up to 8.3 percent. It has not gone below 8 percent since January 2009. (credit:AP)
Jim Cramer: Obamacare Will Topple The Stock Market(03 of12)
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On March 18, 2010, Jim Kramer stated on Larry Kudlow's program that Obamacare would tank the stock market. The reform package was, in his words, "the single greatest impediment to the stock market going higher."On March 23 of that year, according to CBS News, President Obama signed health care reform into law. Following Yahoo's tracking of the Dow Jones, the market on April 1 2010 was at 10,927. On August 17, over two years later, the Dow Jones Industrial Average was pegged at 13,264. Granted, the market could still take a nose dive. But odds are it won't be because of health care reform. (credit:AP)
Michelle Bachmann: Obama Taking 'The Final Leap To Socialism'(04 of12)
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In a radio interview Minnesota Congresswoman Michelle Bachmann gave with Bill Bennet in March of 2009, the Minnesotan claimed that Obama's policies were representing the "final leap into socialism," Think Progress reported.But alas, while Bachmann's sensational claim may have gotten her into the spotlight, the government has been engaged in selling its stake in the industries that it had to temporarily prop up.General Motors, an automaker that the U.S. government had to prop up with emergency capital, bought back all preferred shares held by the U.S. Treasury as of December 2010, reports The New York Times.Wall Street's largest banks that have frequently brought about wrath from liberals such as Paul Krugman, like Citi, Goldman Sachs and JP Morgan, are still privately run. (credit:AP)
Glenn Beck: U.S. Will Go Through 'Great Depression Times 100' (Or Hyperinflation)(05 of12)
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In early 2010, then-Fox News commentator Glenn Beck said that the U.S. was likely in for a "Great Depression Times 100," reports Media Matters, going on to say that the country would experience a period of hyperinflation.Unemployment during the Great Depression peaked at around 25 percent, according to an article published by the Bureau of Labor Statistics. But even at the worst moments of the Great Recession, unemployment only reached slightly above 10 percent. Presently, it is at 8.3 percent, according to the Bureau of Labor Statistics. With inflation estimated to remain stagnant at 1.5 percent through 2012, the nightmare warnings of hyperinflation expounded by Beck as well as by renowned "economist" Peter Schiff appears to be just that. A nightmare. (credit:AP)
Rick Santelli: 'Stagflation Is Almost A Certainty'(06 of12)
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In October of 2009, CNBC analyst and Tea Party founder Rick Santelli told said on the show Fast Money that he believed "stagflation is almost a certainty." In other words Santelli was predicting that America would go through a period of high inflation and high unemployment. The only question he had was when.In November of that year, the Bureau of Labor Statistics revealed that between October 2008 and October 2009, prices rose by 1.7 percent not including food and gas. This made, at the time, Santelli's claim even bolder. Even though unemployment is still high -- almost three years later -- inflation has risen far below the Federal Reserves 2 percent annual target, Bloomberg reports. (credit:Getty Images)
Rush Limbaugh: Obamacare Will Leave 250 Million People Uninsured(07 of12)
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Among the many predictions conservative radio host Rush Limbaugh has made over the years, the one he made on March 8, 2010 was not one of his best.On his daily radio show The Rush Limbaugh Show, Limbaugh announced to his listeners that healthcare reform, which would be signed into law later that month, would end up leaving 250 million Americans uninsured, Media Matters reported.As of June 2012, 49.9 million Americans do not have health insurance, CNN estimated. (credit:AP)
Mitt Romney: U.S. WIll Default If We Raise Debt Ceiling(08 of12)
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In the June 13, 2011 Republican Presidential Debate, Mitt Romney, when asked about the consequences of not raising the debt limit answered the moderator's question with a question. "Well, what happens if we continue to spend time and time again, year and year again more money than we take in?"As Asher Smith pointed out on The Huffington Post, this can only mean that the U.S. will eventually be unable to pay off its obligations and, as a result, default.Bit as of August 2012, close to one year after the debt ceiling was raised, the U.S. still hasn't defaulted. (credit:AP)
Bill Gross: End Of QE2 Would Cause Bond Yields To Go 'Much Higher'(09 of12)
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In March of 2011, PIMCO Co-Founder Bill Gross predicted an imminent spike in treasury bond yields following the end of the Federal Reserve's Quantitative Easing program, Fortune's Colin Barr reported.Bond yields, Gross told reporters, were likely to go "higher maybe even much higher" at the end of June 2011 when QE2 ended. The 10-year treasury bond yield has since fallen. Since the 2011, 10-year bond rates have hovered between 2.5 and 1.5 percent, according to Bloomberg.
Joe Biden: US Out Of Recession In 18 Months (Feb. '09)(10 of12)
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In February of 2009, Vice President Joe Biden predicted that the federal stimulus package being implemented by Barack Obama's administration would "literally drop kick us out of this recession," The Hill reported. "This [stimulus] is about getting this out and spent in 18 months to create 3.5 million jobs."Technically, the recession ended during the third fiscal quarter of 2009, according to the Bureau of Economic Analysis. But with unemployment hovering around over 8 percent for the last three years, some economists are no longer talking about calling the current economic period a recovery. Brad DeLong, an economist with UC Berkley, told readers on his blog in 2011 that we're now in the midst of a "Little Depression" instead.
Peter Schiff: Inflation At 20 Percent By 2009(11 of12)
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Economist Peter Schiff stated that the Federal Reserves monetary policies would lead to 20 percent inflation within one year. The statement, made in October 2008 on Glenn Beck's former CNN program, was proven wrong. During 2009, the U.S. actually experience deflation. (credit:AP)
Ron Paul: Beware Of Runaway Inflation(12 of12)
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Congressman Ron Paul believed that runaway inflation was "just horrendous" in May 2011, he said during an appearance on Fox Business News. When Congressman Paul made that statement, inflation was pegged at 3.2 percent and, after peaking at 3.9 percent that October, inflation has steadily fallen to 1.4 percent in July 2012. (credit:AP)
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