With several Republicans lending their support, the Senate Banking Committee has given Janet Yellen its vote of approval to be the next Federal Reserve chair.
Next, her confirmation must be taken up by the full Senate. Chairman Ben Bernanke's term is up at the end of January.
Yellen, the current vice chair, would be the first woman to lead the nation's central bank in its 100-year history.
Committee Chairman Tim Johnson, D-S.D., said, "Yellen understands the challenges facing our economy and the balance the Fed must strike as we navigate the path back to full employment." He noted that Yellen "understands the importance of completing ongoing Wall Street reform rulemaking and of the Fed's regulatory role in supervising the riskiest banks."
The panel's vote was 14-8, led by support from Democrats. Republican Sens. Bob Corker of Tennessee, Mark Kirk of Illinois and Tom Coburn of Oklahoma voted in Yellen's favor, defecting from their opposing colleagues.
With stocks at record highs, critics fear that the Fed has taken on too much risk while keeping interest rates at record-low levels and maintaining asset purchases meant to drive down unemployment. Ranking Republican Sen. Mike Crapo of Idaho announced that he opposed Yellen's nomination, citing the Fed's "easy money policies." Crapo said Yellen "gave no indication that a prompt return to normalized policy was on the horizon."
Minutes from the October policymaking session indicated that the Fed could begin to wind down asset purchases "in the coming months." The minutes described a vigorous debate surrounding the next steps needed to reverse unprecedented action taken during and after the financial crisis.
Yellen's challenge will be to forge a consensus among members of the Federal Open Market Committee, or FOMC, while continuing to lead the economy through uncharted territory.
Economist Robert Brusca said he thinks the Fed's policies are "becoming more controversial." Brusca, with Fact and Opinion Economics, says, "The longer the economy is mired in poor growth, the more these programs will come under fire, especially by those who fear the consequences once 'things get better.' Yellen has already endorsed these controversial policies."
The Fed's next meeting is scheduled for mid-December. Yellen's first scheduled meeting as chair, assuming she is confirmed by the full Senate, would be in March.
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