In a historic move, President Obama will nominate Janet Yellen to lead the Federal Reserve, or the Fed, as it is commonly known. Yellen will chair the nation’s central bank and one of the most important economic institutions in the world. Currently serving in the number two spot as the Fed’s Vice Chair, Yellen will be the first woman to head the institution. Given her focus on making the economy work for average Americans, progressives campaigned hard for her to succeed present Chair Ben Bernanke when he leaves office at the end of the year.
The Fed sets the amount of money in circulation, which helps determine how large our economy can get and how fast it can grow. The Fed has two principle responsibilities: to ensure that any economic expansion is sustainable, and to foster full unemployment. It also plays a pivotal role in the regulation of Wall Street.
Massachusetts Senator and economic advocate Elizabeth Warren recently told MSNBC that Janet Yellen would “make a terrific Federal Reserve Chair.” A key reason is that since she joined the Fed’s Board of Governors in 2010, Yellen has long argued that job creation, over other important Fed goals, should be a top priority.
Yellen’s two principal rivals for the post, former Treasury Secretary, Timothy Geithner, and former head of the National Economic council, Larry Summers, were seen to be less amenable to this view. Geithner and Summers were chief architects of the “too big to fail” financial system that led to the 2008 economic crisis and subsequent recession.
Though Yellen’s path to Wednesday’s nomination was not always certain, many struggling in today’s economy will likely welcome it. The Senate will begin hearings on Yellen’s nomination in the next few weeks.