Donald Trump nominee Nellie Liang withdraws from Fed board consideration
- In a statement, Liang cited concern over a lengthy Senate confirmation process
- She would have been the first minority woman to serve on the Fed’s board
This story is published in a content partnership with POLITICO. It was originally reported by Victoria Guida on politico.com on January 7, 2019.
Economist Nellie Liang has withdrawn her name from consideration for a seat on the Federal Reserve board, the White House announced on Monday, potentially giving US President Donald Trump an opportunity to tap someone who's more in line with his preference for low interest rates.
Liang, a 31-year veteran of the central bank’s staff, had received the strong backing of Fed Chairman Jerome Powell, who has been the target of intense criticism from Trump in the past few months.
But she drew opposition from key Republicans in the Senate, and big banks were against her nomination from the start because of her role in shaping post-financial crisis regulations.
Still, she is withdrawing on her own, and the administration did not ask her to step aside, according to a person familiar with the matter.
In a statement to POLITICO, Liang said she was withdrawing “because the likelihood of a prolonged process could have left me in professional limbo for too long”.
She said she hoped to continue contributing to the central bank as an outside researcher.
White House spokesperson Lindsay Walters said the administration accepted Liang's decision with regret.
“We supported her nomination and believe she would have made a good governor,” Walters said.
There are two open seats on the Fed’s seven-member board.
In the previous Congress, Liang had been nominated for one slot while Carnegie Mellon Professor Marvin Goodfriend was picked for the other.
It is unclear whether Goodfriend will be renominated.
Goodfriend appeared to have no support from Democrats and faced opposition from Republican Senator Rand Paul.
His past writings also indicate that he would be inclined to be more aggressive in raising rates, making him an odd fit for Trump, who has complained that the Fed's tightening monetary policy is endangering the economic expansion.
Liang, a Ph.D. economist and reportedly a registered Democrat, was the first head of the Fed’s office of financial stability from 2010 to early 2017.
She gave key input into the development of the central bank’s strict post-crisis regulations and conducted extensive research into the interaction between interest rate policy and financial stability.
She would have been the first minority woman to serve on the Fed’s board.