Funny, I thought the Regional Fed Presidents were better on monetary policy than the Board of Governors. What do you think? This certainly would not help with the diversity issue.
Barney Frank, The Massachusetts Democrat announced Tuesday morning that he’s introducing a bill that would dramatically downsize the Federal Reserve’s policymaking committee, eliminating five regional Fed presidents from having a say in the central bank’s decisions.
The Federal Open Market Committee, or FOMC, is structured to include 12 voting members, made up of seven Fed governors and five presidents from regional Fed banks.
The committee meets eight times a year to vote on interest rates and other monetary policy decisions that affect the entire U.S. economy by influencing credit conditions, inflation and unemployment.
Frank’s main complaint is with the selection process. Unlike Fed governors, the regional bank presidents are not selected by elected officials, but by a board comprised of business leaders in their communities.
“These men and women are chosen by a self-perpetuating group of private citizens who disproportionately represent the private financial services industry,” Frank said in a statement.