{"id":390281,"date":"2010-03-04T11:42:21","date_gmt":"2010-03-04T16:42:21","guid":{"rendered":"http:\/\/blogs.wsj.com\/economics\/2010\/03\/04\/in-search-of-an-economist-for-fed-board-prestige-power-and-a-pay-cut\/"},"modified":"2010-03-04T11:42:21","modified_gmt":"2010-03-04T16:42:21","slug":"in-search-of-an-economist-for-fed-board-prestige-power%e2%80%a6-and-a-pay-cut","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/390281","title":{"rendered":"In Search of an Economist for Fed Board: Prestige, Power\u2026 and a Pay Cut"},"content":{"rendered":"

The retirement of Federal Reserve<\/strong> Vice Chairman Don Kohn<\/strong> has the Obama administration searching for economists to fill one or more of the three openings of the seven-member Fed board. Among the possibilities for the vice chairman slot are a couple of alumni of the Greenspan Fed board: Janet Yellen<\/a>, who has been president of the Federal Reserve Bank of San Francisco<\/strong> since 2004, and Laurence Meyer<\/a>, a private, Washington-based Fed watcher.<\/p>\n\n\n\n\n
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You may have to take a pay cut, but you get to work in the Fed building in Washington. (Getty Images)<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Among other names surfacing: Alan Krueger<\/a>, a Princeton University<\/strong> labor economist who is now assistant Treasury secretary for economic policy, and Jeremy Stein<\/a>, a Harvard University<\/strong> finance professor who did a brief turn in the Obama administration last year. Yellen and Krueger both did stints in the Clinton administration: Yellen as chair of the White House Council of Economic Advisers<\/strong> and Krueger as the chief Labor Department<\/strong> economist.<\/p>\n

Daniel Tarullo<\/a>, the Obama appointee to the Fed board, seems to prefer being the Fed\u0092s banking czar to the vice chairman\u0092s duties. And word is that Christina Romer<\/a>, the economic historian on leave from Berkeley<\/strong> to chair the White House Council of Economic Advisers, isn\u0092t interested in a move to the Fed. Kohn\u0092s retirement, at age 67, leaves Chairman Ben Bernanke<\/strong> the only economist on the Fed board.<\/p>\n

Elevating a Fed staffer to the Board is an option. Among the possibilities: Brian Madigan<\/a>, chief of the Fed\u0092s Division of Monetary Affairs, a post Kohn once held; John Williams<\/a>, research director at the San Francisco Fed who would be a contender for Yellen\u0092s job if she left; and Jeffrey Fuhrer<\/a>, the Boston Fed\u0092s research director.<\/p>\n

One rub for some potential candidates: The pay cut.<\/p>\n

The law sets the salary of members of the Federal Reserve Board<\/strong> — and the vice chairman — at $179,700 a year, which sounds like a nice wage to the typical American worker, but is lower than many potential nominees currently earn. That could pose a problem in recruiting for the three openings on the seven-member board. Salaries for presidents of the 12 regional Fed banks, whose pay is set by their private-sector boards of directors, ranged in 2008 (the latest publicly disclosed) from $293,000 in Atlanta to $411,200 in New York. (Tim Geithner<\/strong> took a big pay cut when he surrendered the New York Fed presidency to become Treasury secretary, which pays $199,700, the same as the Fed chairman\u0092s job.) San Franciso\u0092s Yellen made $392,600 in 2008. Top Fed staff economists routinely earn more than their bosses<\/a> on the Board of Governors; salaries at regional Fed banks are sometimes higher than in Washington.<\/p>\n

The same applies to finance professors — such as Austan Goolsbee<\/a>, on leave from the University of Chicago<\/strong>’s Booth School of Business<\/strong> to serve as a member of Romer\u0092s Council of Economic Advisers and another possible Fed nominee. A rookie at a top-ranked business school, one finishing a Ph.D. and who hasn\u0092t taught before, makes about $185,000 for nine months\u0092 work, and then often gets another two months pay on top of that, bringing the typical total annual pay close to $250,000. Senior professors with active research programs often make more than $300,000 — and that\u0092s before outside consulting jobs. (Professors in economics departments outside of business schools usually make less than their business-school counterparts, and don\u0092t get that two-month bump.)<\/p>\n

Of course, a stint on the Fed board tends to elevate the price the market pays for speeches and consulting afterward. Mr. Meyer\u0092s asking price: $30,000 a speech<\/a>.<\/p>\n

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The retirement of Federal Reserve Vice Chairman Don Kohn has the Obama administration searching for economists to fill one or more of the three openings of the seven-member Fed board. Among the possibilities for the vice chairman slot are a couple of alumni of the Greenspan Fed board: Janet Yellen, who has been president of […]<\/p>\n","protected":false},"author":850,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-390281","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/390281","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/850"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=390281"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/390281\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=390281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=390281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=390281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}