Federal Reserve Chair Janet L. Yellen earned widespread approval for her term at the helm of the U.S. central bank, a singularly powerful job in the global economy. She became the first woman to hold the post when former president Barack Obama nominated her in 2013.
People who don’t agree on much else have generally agreed that her record is stellar. Sen. Elizabeth Warren (D-Mass.) called her “one of the most successful Fed chairs in history.” President Trump said that she’s done an “excellent” job.
- On Yellen’s watch, unemployment fell sharply. In October, it reached 4.1 percent, the lowest point since 2000
- Inflation stayed subdued
- Wages began to rise
- She managed a gradual start to the Fed’s unwinding of its $4.5 trillion balance sheet
But last week, Trump announced he would not name Yellen for a second term when her tenure expires at the end of January.
The previous three men to the hold Yellen’s job were reappointed by presidents of opposing parties.
And Trump isn’t choosing to replace her with someone with a much different vision, either. He tapped Jerome Powell, a mild-mannered Fed governor with far less experience working on economic issues who is expected to stay the course that Yellen set. Trump rejected others who would have been a break with Yellen’s approach.
If confirmed, Powell will become chair in February. Yellen has the option to stay on as a governor.
The decision to replace Yellen comes amid growing concern about the low numbers of women in economics and the challenges they face in moving ahead in the field.
“Janet Yellen was known to be the hardest-working person around: She set the bar so high, and as a result of her hard work she was ahead of the curve on so many things,” said Julia Coronado, president of MacroPolicy Perspectives and a former Fed staff member. “Despite that, she’s not getting the job back.”
The White House rejected the notion that gender was a factor.
“The mere suggestion is an affront to Chair Yellen,” White House press secretary Sarah Huckabee Sanders said in a statement. “The president chose a highly qualified nominee, and has expressed only the utmost respect for her service.”
But one activist groups sees it differently.
“This unusual and sexist decision should be deeply disturbing to both liberals and conservatives alike, who recognize the unprecedented nature of Yellen’s success and understand the importance of maintaining stability in our banking system,” Shaunna Thomas, co-founder of UltraViolet, a group focused on feminist issues and social media advocacy, said in a statement.
Some female economists said that not too much should be read into the decision, pointing out it’s not surprising Trump would want to go his own way. Republicans have been longtime critics of Yellen.
“Donald Trump likes to do things his own way, and this is a very partisan moment,” Rivlin added. “So I’m not surprised that he wanted to change leadership at the Fed.” Powell is “a very credible candidate.”
Yellen’s tenure was marked not only for her handling of monetary policy and headline economic numbers, economists said, but for her deft leadership of the Fed, helping to bridge the deep and heated divides that sometime exist between members.
“She corralled the cats,” said Diane Swonk, a Chicago-based economist.
Others pointed to Yellen’s listening skills and her willingness to speak about monetary policy and macroeconomics in terms of their tangible benefits on workers and communities, a touch that Karen Dynan, a former Treasury Department chief economist, said may have helped draw more women to economics.
“She can be tough, but she is also warm and compassionate and a good listener. And I think this has made her extraordinarily effective,” she said.
But economists don’t often use the terms “tough,” “compassionate” or “good listener” to describe women in the profession.
To measure sexist attitudes in the field, Alice Wu, then a student at the University of California at Berkeley, mined more than a million posts on an online message board, Economics Job Market Rumors.
- Among the words most associated with women: “hotter,” “lesbian,” “anal,” “slut,” “hot,” “feminazi,” “marry” and “dated.”
- The terms for men? “Mathematician,” “pricing,” “adviser,” “motivated,” “Nobel.”