Thread by @KalebNygaard

🥂Cheers to all of us for surviving the wait for the full suite of Fed nominees 🥂

I’ve written a lot about Fed diversity over the last few years. It’s time for a #FedThread 🎉 on the geographic diversity requirement for Governors.

1/13

The geographic diversity requirement for Governors is quite explicit. And it’s been there since the OG 1913 law.

“...not more than one [Governor] shall be selected from any one Federal Reserve district…”

2/13

The first few pages of this law article give a great history of how this line got in the 1913 act.

Without the requirement, some congressmen feared it would “represent the interests of East Coast bankers to the detriment of the entire country.” ylpr.yale.edu/sites/default/…

3/13

The Fed’s website has a handy list of all the Governors (past and present) and which district they are “from”.federalreserve.gov/aboutthefed/bi…

Here are the districts already taken (in red), available (in white), and a map of the district boundaries.

4/13

Now, although the Fed’s website lists a district…they don’t tell you how they define “from”.

I’m doing this whole thread because for the majority of Governors it’s not where they lived/worked right before becoming a Governor 🧐 weird, right??

5/13

So to investigate this, I went all the way back to every Governor who has been confirmed since Arthur Burns in 1970 (a total of 52) and I documented how they were connected to this place they were supposedly “from”. Here’s what I found:

6/13

And because the reasons are actually pretty fun to browse here is the full list 🤓

7/13

List continued…

8/13

This chart here is very interesting because it shows the dramatic decrease in the use of the classic “current job” definition in the last few decades.

9/13

The defining of “from” is done by both the White House and the Senate. The WH does it via the formal nomination forms that they send to Congress. The form introduces each nominee as “of [State]”. The Senate does it mostly via the confirmation hearings.

10/13

Nominee Peter Diamond, the Nobel prize winning labor economist, was rejected basically because Senate Rs didn’t like him, but one of their loudest excuses was that the form said “of Massachusetts” and another Governor had already claimed to be “from” the Boston district.

11/13

Given Biden was literally there for Diamond fiasco & knowing the Senate is so divided - you’d think the WH would try avoid this issue at all costs…but nope, in the form sent to Congress the WH lists Raskin from Maryland & Jefferson from North Carolina - both Richmond Fed!

12/13

I have no idea why the WH didn’t preempt the questions and just pick one of the other definitions. Heaven knows they have options! I went ahead and listed them out here 😅

Raskin could easily claim Boston ✅

Jefferson could easily claim New York or Philadelphia ✅

13/end