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White House considering Derek Kan for Federal Reserve Board seat, sources say

Rep. Denham (R-CA), Campaigning For Re-Election, Holds Roundtable In Modesto, California
Derek Kan, a U.S. Transportation Department undersecretary, tours infrastructure projects in Modesto, Calif., in October.
(Justin Sullivan / Getty Images)
Bloomberg

The White House is considering Derek Kan, an undersecretary at the Department of Transportation, for one of two open seats on the Federal Reserve Board, according to two people familiar with the matter.

Kan, a senior advisor to Transportation Secretary Elaine Chao since 2017, has served on the board of directors for Amtrak after being nominated by then-President Obama in 2015, and he was previously general manager at ride-hailing company Lyft Inc.

Kan has not been interviewed by the White House for the job but has had informal conversations with members of National Economic Council Director Larry Kudlow’s team, according to one of the people. Kan earned a master’s in business administration from Stanford University and studied economic history at the London School of Economics.

President Trump has struggled to find candidates for the Fed who are acceptable to the senators who vote on whether to confirm them. Trump has named four people for the two open seats on the board of governors. None of them has made it through the Senate, raising questions about the White House vetting process for his picks.

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Conservative economic pundit Stephen Moore on May 2 became the latest Fed candidate to flame out, following businessman Herman Cain and economists Nellie Liang and Marvin Goodfriend.

The White House hasn’t made a shortlist of candidates, but instead has a handful of names that the Trump administration is actively considering as advisors continue to gather resumes, according to one of the people familiar with the matter who discussed the search on condition of anonymity. The White House declined to comment.

Senate confirmation

Kan won Senate confirmation by a 90-7 vote for his current job at the Transportation Department. Already having gone through that process on Capitol Hill may help his chances to win approval again for the Fed should he be nominated. He would be the first Asian American on the Fed board.

A Democratic senator tweeted in Kan’s support Friday. Sen. Brian Schatz of Hawaii called Kan a “serious, smart person and a vast improvement over the previously mentioned names.”

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Cain and Moore dropped their candidacies after Republicans and Democrats spoke out against them. Cain was criticized over allegations of sexual harassment, and Moore over his past writings about women.

Another potential candidate to surface is conservative economist Judy Shelton, the U.S. executive director for the European Bank for Reconstruction and Development. Shelton, who has served as an informal advisor to Trump, holds a doctorate in business administration with an emphasis on finance and international economics from the University of Utah.

Before the current 0-for-4 streak, Trump succeeded in filling three posts on the Fed board and elevating Jerome Powell, already a governor, to the chairmanship — though the president soured on Powell as the central bank raised interest rates last year. The president also won Senate confirmation of Fed Vice Chairman Richard Clarida and the Fed’s vice chairman for supervision, Randal Quarles.


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