The Senate on Tuesday confirmed President Joe Biden’s appointment of Federal Reserve Gov. Lael Brainard as the central bank’s vice chair, elevating one of the Fed’s most outspoken climate change critics to a post overseeing bank regulation and monetary policy amid the highest inflation rate in 40 years.
In a vote of 52 to 43 on Tuesday afternoon, the Senate confirmed Brainard, the sole Democrat on the Fed’s seven-member board, for a term ending in early 2026; she succeeds Richard Clarida, whose first term expired on January 31.
Earlier this month, Brainard, 58, said the central bank would raise rates “expeditiously” and expressed confidence in the Fed’s ability to cool rising prices, saying “it is of paramount importance to get inflation down.”
A Fed governor since 2014, Brainard becomes just the third woman to serve as Fed Vice Chair, preceded only by Treasury Secretary Janet Yellen, who was appointed by Obama and also served as Fed Chair from February 2014 to February 2018, and the late Alice Rivlin , who served as vice chair from June 1996 to July 1999.
As scrutiny over individual stock trades cast doubts on Clarida’s potential reappointment, Brainard became many progressives’ pick to head up the Fed thanks to her bold stance on climate change, especially compared to Jerome Powell, who has said the Fed has only a “narrow mandate ” on climate change.
In October, Brainard outlined an early blueprint for climate-related stress tests for large financial institutions akin to the required stress tests brought on after the Great Recession to assess banks’ capital requirements.
While discussing the “first generation” of such tests, Brainard said it will be “important” to begin assessing financial institutions’ resilience to climate-related risk scenarios, citing the record-high cost of US weather disasters over the last five years of $630 billion.