Ferguson Picked for Fed Post
President Bush will nominate Federal Reserve Vice Chairman Roger Ferguson for another term on the board, the White House said Monday.
The White House gave no indication when it plans to fill two other vacancies on the seven-member Fed board.
Ferguson, the first black ever to serve in the No. 2 position at the Fed, was originally nominated to the central bank in 1997 by then-President Clinton, who elevated him to the post of vice chairman in 1999 to succeed Alice Rivlin.
Federal Reserve Chairman Alan Greenspan welcomed Bush’s selection of Ferguson, praising him for “exercising sound judgment and benefiting our work on a wide range of domestic and international policy issues.”
Ferguson’s term on the board expired Jan. 31, 2000, but under law he is allowed to remain in the position until a successor is approved by the Senate. Full Fed board terms run for 14 years. His new term will expire in 2013.
Clinton had nominated Ferguson for another term on the board, along with Carol Parry, a former official at Chase Manhattan Bank. She was nominated for one of the vacant board seats.
Both nominations were blocked by Senate Banking Committee Chairman Phil Gramm (R-Texas), who argued last year that the Fed positions should be filled by the next administration.
Ferguson, 50, who holds both a doctorate in economics and a law degree from Harvard, had been a partner at the consulting firm of McKinsey & Co., before joining the central bank.
Tom Sheehan, president of the Independent Community Bankers Assn. of America, praised Ferguson’s selection as “a wise appointment that will benefit community banks and all other payment system participants.”
Banking organizations have been pushing to have Bush select a banker for one of the vacancies on the Fed board, which is now heavily weighted to economists.
One person who has been mentioned for one of the vacancies is Terry Jorde, a small town banker in Cando, N.D.
Private economists saw Ferguson’s selection as another effort by the Bush administration to build cordial relations with Greenspan, who was said to have been lobbying heavily on Ferguson’s behalf.
“With Greenspan’s strong backing, there had been little doubt that Ferguson would be reappointed,” said Sung Won Sohn, chief economist at Wells Fargo in Minneapolis. “Mr. Ferguson had become the in-house expert on many of the Fed’s important operational jobs, including check processing and the operation of the payments system.”
In addition to the Fed post, the White House also said Monday that the president will nominate Kenneth Dam as deputy Treasury secretary, the No. 2 job at that agency.
Dam is a University of Chicago law professor and a longtime friend of Treasury Secretary Paul O’Neill. They worked together as budget analysts in the Nixon administration. He also served on the board of aluminum giant Alcoa after O’Neill took over as its chief executive.
When Ronald Reagan was president, Dam served as deputy secretary of state, a job he left to take the helm of International Business Machines Corp.
Both the Fed job and the Treasury post are subject to Senate confirmation.
