Clinton Adviser Is Reportedly Favored for Fed Post

White House economist Alan Blinder is likely to be nominated as vice chairman of the Federal Reserve Board, a senior Clinton Administration official said Monday.

The official, speaking on condition of anonymity, said Blinder is “the strong front-runner,” with the support of President Clinton’s advisers. Clinton could make his final decision on the recommendation as early as this week, the official said.

Clinton’s approval is expected, the official said. Another official, not directly involved in the selection process, said a routine FBI background check may be the only thing standing in the way of Blinder’s nomination.

Blinder was a respected economist at Princeton University before joining the Administration last year as one of three members of the President’s Council of Economic Advisers.

In addition to his teaching duties, Blinder wrote a regular column for Business Week magazine. He once characterized himself as an “inflation dove” and holds views that make him appear less hard-line in fighting inflation than some current Republican-appointed Fed members.

Blinder would be Clinton’s first Fed nominee. The vacancy was created when David Mullins, appointed by then-President George Bush, unexpectedly announced his resignation Feb. 1 to join a private investment management firm.

In addition to the vice chairman’s post, Clinton must fill another position on the seven-member board that was created when Wayne Angell left recently after his term expired.

One of the names most often mentioned to fill the Angell vacancy is George L. Perry, an economist at the Brookings Institution, but the senior official said the White House was not as close to naming someone to fill Angell’s seat. It was unclear whether Perry was still in the running or whether he would accept a spot on the board if he was passed over for the more prestigious position of vice chairman.

Clinton’s Fed nominees must be approved by the Senate.

Officials have said that the person Clinton names to the vice chairman’s job would have to be considered a top candidate for the post of chairman when Fed Chairman Alan Greenspan’s term ends in 1996.