Powell and Brainard aiding 'an economy where companies have to compete for workers': NEC member
National Economic Council Deputy Director Bharat Ramamurti joins Yahoo Finance Live to give an overview on President Biden's decisions to renominate Fed Chair Jerome Powell and choose Lael Brainard as Fed Vice Chair.
Video Transcript
BRIAN CHEUNG: We're pleased to be joined now by a guest inside the White House. For more on this, we have Bharat Ramamurti, who is the National Economic Council deputy director. Thank you so much for joining us on what I'm sure is a very busy Monday for you. Just kind of starting off broadly here, the announcement here with the Powell-Brainard-led Fed, what type of excitement does that give you inside the White House? Why ultimately do you think the president ultimately ended up going with this decision?
BHARAT RAMAMURTI: Well, thanks for having me on. And it's an exciting day. I think from the president's perspective, we've already had a huge amount of economic progress in his first months in office. If you look at where we've come from, we're at 4.6% unemployment right now.
That's about two years ahead of schedule, based on what experts were predicting at the beginning of the year. We created 5.6 million jobs under this administration. Disposable income for families is up 2% relative to pre-pandemic. And in fact, the United States is the only leading economy in the world, where household income and the size of the economy are bigger than they were pre-pandemic, even accounting for the effects of inflation.
So we've come a long way. The president has been clear, though, that we still have a ways to go to make sure that we are building an economy that works from the bottom up and from the middle out. And his belief is that Chair Powell and elevating Lael Brainard to serve as vice chair of the Fed are a good team to lead that effort going forward and to balance, as the Fed has to, our focus of maintaining low and stable price increases, and at the same time, pursuing a full employment economy, where everyone who wants a high quality job can get it.
BRIAN CHEUNG: So can I ask if you view this nomination as staying the course? Because the White House statement did point to the changes that were made over the last few years under Powell's leadership to prioritize reducing the shortfalls for maximum employment, even if inflation does get a little bit uncomfortably high for moderate periods of time, because you do still have both of these Fed people staying at the Fed under these picks, although, again, you're kind of elevating one of them, Lael Brainard, to that vice chair spot. Is this kind of an affirmation of what they've already done and a continuation of the policies they've already set?
BHARAT RAMAMURTI: Yes, I believe the president thinks that both Chair Powell and now-- and hopefully, Vice Chair Brainard have done an excellent job at the Fed. And that's why he wants to preserve that team at the top of the Fed's leadership. They have both been laser focused on building an economy where companies have to compete for workers, rather than workers having to compete for jobs. That's the kind of economy where wages are growing, where benefits for middle class families increase or schedules become more predictable and more flexible for families who need them.
These folks have been focused on stability on the price side as well. I think that we are in the middle of a challenging period where supply chains are producing inflation globally, not just in the United States. And it's going to be up to the Fed to navigate this very important time. The president, I believe, wanted a pair of folks who are highly experienced, highly credible, and have broad bipartisan support, both inside of Congress and outside.
BRIAN CHEUNG: Maybe you could see the podium. Our viewers, by the way, can see that on our screen, where we're still awaiting the president to approach any minute now. But Bharat, in the meantime, I want to ask about climate policy because you hopped on as early or as recently as last week. So, by the way, thanks again for hopping on with us again.
But you talked about the idea of climate being a top priority here, a climate-related risk that could come from extreme weather events or the transition to greener energy might be an issue. Some were arguing that was in support, broadly, of a Brainard candidacy and that anyone that kind of prioritizes climate would want to prefer a Brainard over a Powell. Why did you ultimately decide to go with keeping Powell there and then putting Brainard in a vice chair spot, but not only that, not the vice chair of supervision spot, where she may have had a little bit more purview over those types of things?
BHARAT RAMAMURTI: Well, look, if she is confirmed as vice chair, Dr. Brainard is going to have an enormous effect on the Fed's decisions on the monetary policy side and on the financial regulation side. I think that her pioneering work on the impacts of climate change on the financial system--
BRIAN CHEUNG: Yep, and Bharat, I'm really--
BHARAT RAMAMURTI: [INAUDIBLE] on that front is the reason why the president chose--
