Lael Brainard is the director of the U.S. National Economic Council. She was appointed by President Joe Biden to the position in February 2023. She had been a member of the Board of Governors of the Federal Reserve System (FRB) since June 2014, chosen by then-President Barack Obama to fill an unexpired term that ends on Jan. 31, 2026. Her appointment to the National Economic Council required her to resign from the Fed, where she was vice chairman of the Board of Governors.
Brainard was at one point seen as a potential candidate for Fed chairman. However, on Nov. 22, 2021, the White House announced that the president would renominate Jerome Powell for another four-year term as Fed chair, with Brainard being nominated to fill the open seat of vice chair. The Senate voted to confirm Brainard as the Fed vice chair on April 26, 2022.
- Lael Brainard is the director of the National Economic Council, a position she has held since February 2023.
- Brainard previously was the Fed vice chairman, having been confirmed by the U.S. Senate in April 2022.
- Brainard earlier had been mentioned as a leading candidate to replace Jerome Powell as Fed chair.
- Brainard has held a variety of federal posts under Presidents Bill Clinton and Barack Obama.
- Prior to that, she was a consultant at McKinsey & Co. and an economics professor at the Massachusetts Institute of Technology’s (MIT) Sloan School of Management.
Early Life and Education
The child of an American diplomat, Brainard grew up in East Germany and Poland during the Cold War. She received a B.A. with university honors from Wesleyan University in 1983. She received an M.S. and a Ph.D. in economics in 1989 from Harvard University. She was awarded a National Science Foundation Fellowship and a White House Fellowship.
Prior to joining the FRB, Brainard was undersecretary of the U.S. Department of the Treasury from 2010 to 2013 and counselor to the secretary of the Treasury in 2009. During this time, she also was the U.S. representative to the Group of 20 (G-20) Finance Deputies and the Group of Seven (G-7) Deputies, and a member of the Financial Stability Board. She was given the Alexander Hamilton Award for her service.
G-7 vs. G-8
The Group of Seven (G-7) became the Group of Eight (G-8) in 1998, when Russia joined the U.S., the U.K., Germany, France, Japan, Italy, and Canada as a member of this association of leading developed nations. However, Russia was suspended in 2014 after annexing the Crimean peninsula from Ukraine, making the association effectively the G-7 again.
From 2001 to 2008, Brainard was vice president and the founding director of the Global Economy and Development Program and held the Bernard L. Schwartz Chair at the Brookings Institution, where she built a new research program that examined global economic challenges. The Brookings Institution, founded in 1916, is a nonprofit public policy research organization, or think tank, based in Washington, D.C.
Brainard was the deputy national economic adviser and deputy assistant to then-President Bill Clinton. She also was President Clinton's representative to the G-8 and the G-7. From 1990 to 1996, Brainard was assistant and associate professor of applied economics at the Sloan School of Management of the Massachusetts Institute of Technology (MIT). She has published numerous articles on economic topics and is the editor or co-editor of several books.
Prior to her teaching position at MIT Sloan, Brainard worked in management consulting at McKinsey & Co.
In 2019, Brainard was one of five recipients of the Centennial Medal awarded by the Graduate School of Arts and Sciences (GSAS) at Harvard University. The Centennial Medal is the highest honor bestowed by Harvard's GSAS.
The Brookings Institution, where Brainard formerly worked, has more than 300 scholars affiliated with it, and its research topics include, foreign policy, economics, development, governance, and metropolitan policy.
Director of National Economic Council
In mid-February 2023, President Biden named Brainard to head the White House's economic policy team as the director of the National Economic Council. She succeeded Brian Deese in this role.
Brainard is viewed as less restrictive on monetary policy than some of her Fed colleagues at a time in which the Biden administration is hoping to control inflation, which was been rampant in recent quarters.
How is the Director of the National Economic Council Selected?
The director of the National Economic Council, serving as the chief economic advisor in the White House, is appointed directly by the U.S. president.
How is the Vice Chair of the Federal Reserve Board Chosen?
The U.S. president nominates a vice chair from among the members of the Federal Reserve Board. The nomination is subject to confirmation by the Senate, and the vice chair serves for a term of four years.
What Are the Responsibilities of the Federal Reserve Chair?
The chair of the Federal Reserve Board serves as the public face of the Federal Reserve Bank. The chair is the active executive officer of the Federal Reserve Board. The chair's main responsibility is to carry out the mandate of the Fed: to promote the goals of maximum employment, stable prices, and moderate long-term interest rates.
What Does It Mean To Describe an Economic Policymaker as 'Dovish'?
A "dove" is an economic policy advisor who promotes monetary policies that usually involve low interest rates. Doves tend to support expansionary monetary policy because they value economic indicators like low unemployment over keeping inflation low. If an economist suggests that inflation has few negative effects or calls for quantitative easing, then they are called a dove, or labeled as dovish.
The Bottom Line
With Brainard now occupying the chief economic advisor position in the White House, it remains to be seen how she will help to guide and implement President Biden's economic agenda. Brainard is viewed as being more dovish than Powell, meaning less concerned about inflation, and less likely to support an increase in interest rates.