WASHINGTON (Reuters) - University of Southern California economics professor Raphael Bostic has been named president of the Atlanta Federal Reserve bank, breaking the Fed’s longstanding color barrier at the top of its network of regional institutions.
Bostic, 50, becomes the first black regional bank president in the central bank’s 100-year history, a development hailed by advocacy groups that have been pressing the Fed to diversify its upper ranks.
He is also openly gay, and brings a focus on social issues to an institution that often characterizes monetary policy as a blunt instrument with limited ability to influence economic outcomes for particular demographic groups. As an assistant secretary at the Department of Housing and Urban Development from 2009 to 2012 he spearheaded efforts against discrimination based on sexual orientation, work hailed by gay rights organizations.
In a written release, Bostic said the reserve banks, privately run institutions that oversee commercial banks in their districts and whose presidents vote on monetary policy on a rotating basis, “are vital contributors to our nation’s economic and financial success...I look forward to confronting the challenges the Federal Reserve faces in today’s increasingly global and rapidly changing economy.” He takes office on June 5.
With Fed policymakers in a communications blackout period ahead of the central bank’s meeting this week, Bostic did not comment beyond the written statement released by the Atlanta Fed.
He replaces Dennis Lockhart, whose retirement in February touched off a nationwide search that drew broad interest from outside groups and members of Congress who argued it was a prime opportunity to enlist black candidates to run a Fed district that includes a large black population and much of the Deep South.
There are no racial minorities on the Fed’s Board of Governors, and only one other non-white among the 12 regional banks, Minneapolis Fed president Neel Kashkari.
The Fed Up group that has been publicly pressuring the Fed on a number of issues called the appointment “historic” and said Bostic “has dedicated his career to studying and combating racial, economic and social inequity.” The organization as well as labor advocates argue the Fed should refrain from raising interest rates so the current economic expansion can have more impact on the unemployment rate and wages among blacks and other minority groups.
While the Fed is not the sole of province of macroeconomists, bankers and finance experts -- Fed Chair Janet Yellen’s focus as an academic was on labor issues -- many of its top policymakers do share backgrounds in those fields.
Bostic’s career, by contrast, has focused on housing and the impacts of mortgage and credit decisions on minorities, racial differences in lending patterns and small business credit access, and the success of anti-discrimination laws.
Thomas Fanning, chairman of the board of the Atlanta Fed and chief executive officer of the Southern Company, in a written release called Bostic “a perfect bridge between people and policy” with “a wealth of experience in public policy and academia.”
Bostic, a Harvard graduate with a doctorate in economics from Stanford University, also served as an economist at the Fed’s Washington-based board from 1995 to 2001.
Reporting by Howard Schneider; Editing by Andrea Ricci