Janet Yellen Leaves the Fed—and a Glass Ceiling Shattered

Janet Yellen

broke a glass ceiling when she became the first Federal Reserve chairwoman, the most powerful economic policy maker in the U.S., making her coming departure from the central bank bittersweet for some.

Ms. Yellen’s single four-year term as Fed chief leaves an example for a new generation of female economists and policy makers. Her exit also coincides with discussion in the economics profession, and workplaces more broadly, about obstacles that have deterred more women from entering fields long dominated by men.

Ms. Yellen will be succeeded by

Jerome Powell,

a Fed governor who was nominated by President

Donald Trump

and is set to be sworn in on Monday. Mr. Powell, a Republican, won Senate confirmation with bipartisan support.

Every new president since Ronald Reagan has asked the sitting Fed leader to stay on, setting a precedent in which continued service was determined by record, not party. Presidents

Bill Clinton

and

Barack Obama

nominated Ms. Yellen to top positions at the Fed and the White House.

Many observers see Mr. Trump’s choice as an implicit endorsement of Ms. Yellen’s record because Mr. Powell consistently backed her policies.

Mr. Trump said in October, shortly before he announced his decision, that he wanted to put his own stamp on the central bank, “which is maybe one of the things she’s got a little bit against her.”

At an Oval Office meeting last October with the president, Ms. Yellen made clear she wanted to be considered for a second term, according to people familiar with the conversation. Mr. Trump repeatedly told her she had done a good job, including when he phoned her on the morning of Nov. 2 to notify her of his decision.

He announced Mr. Powell’s selection at a Rose Garden ceremony at the White House that afternoon. In another break with precedent, Ms. Yellen wasn’t invited to attend. Mr. Powell’s other Fed board colleagues were invited and did attend, and at the event Mr. Trump called Ms. Yellen “a wonderful woman who has done a terrific job.”

Some of Ms. Yellen’s fans say whether or not gender played a role in Mr. Trump’s decision, it serves as an example of the trials facing even the most successful women.

“People who have spent time in D.C. tend to write it off as just politics, but when you think about what has actually happened—to see this woman who was incredibly effective in her job basically lose her job even though the job was apolitical—it’s very discouraging,” said

Karen Dynan,

a Harvard University economist who served in the Obama administration’s Treasury Department.

Mr. Obama selected Ms. Yellen for the Fed job in 2013 after another messy public contest in which many of his own top advisers favored former Treasury Secretary

Lawrence Summers.

The path for Ms. Yellen cleared only after several Democratic lawmakers threatened to block his nomination.

“It was a big victory,” said

Sheila Bair,

who was picked by President

George W. Bush

to lead the Federal Deposit Insurance Corp. in 2006. “It inspired women to reach high and also to stand up for themselves and other qualified women when they are deserving of promotion.”

Ms. Bair was among those who urged Mr. Obama to choose Ms. Yellen in 2013 and said she deserved to have been nominated for a second term. “Yes, there’s disappointment, but let’s celebrate the victory: She did a great job,” said Ms. Bair.

Ms. Yellen’s example reached beyond economics departments to Wall Street trading desks and foreign finance ministries, said

Betsey Stevenson,

a University of Michigan economist who served in the Obama administration. “If women see all their bosses cowering in fear of what Janet Yellen might say or do—that’s just a different world,” said Ms. Stevenson. “It changes things. It changes your image of what you can do and how you can be.”

Ms. Yellen, 71 years old, was the only woman in her class of economists who earned doctorates from Yale University in 1971, the same year she became one of the first two women on the faculty of Harvard’s economics department.

As a policy maker, she earned colleagues’ respect by being well-prepared and methodical rather than iconoclastic, said

Julia Coronado,

a former Fed economist and founder of advisory firm MacroPolicy Perspectives LLC.

“Janet came from a generation where to advance, you couldn’t really be an outspoken feminist,” said Ms. Coronado. “She didn’t make a lot of noise. She was just very, very good at what she did.”

Ms. Yellen’s time as Fed leader overlaps with a broader focus on the lack of diversity in the economics profession and economic policy-making jobs.

Women account for fewer than a third of economics majors at U.S. colleges and around 15% of full professors. Female economists are even more underrepresented in macroeconomics, which studies how the economy as a whole behaves and is Ms. Yellen’s specialty.

“You look around and you don’t see a lot of women, and it sometimes makes you think, ‘Do I belong here?’” said

Stephanie Owen,

a third-year Ph.D. candidate at the University of Michigan who is studying the economics of education. “It’s why having Chair Yellen has been so important, and the less remarkable it becomes to have women in these positions, the better.”

A growing body of research has pointed to institutional barriers women face in the field. For example, women with similar publication records as men are less likely to earn tenure, their papers take longer during reviews for publication in academic journals, and they are significantly underrepresented in economics textbooks.

In response to concerns about sexism in the profession on a popular job portal, the American Economic Association last month said it would create its own moderated forum.

One cultural challenge in the field is that it is often animated by “who can dominate the room with the loudest comments, the sharpest critiques, the funniest comebacks, and that can be a turnoff to a lot of women,” said Ms. Dynan. “The message Janet sent was you don’t have to act that way to succeed.”

The underrepresentation of women in economics has implications for policy. A 2013 survey of U.S. economists showed women tend to have greater support for income redistribution, regulation and linking import openness to the labor standards of trading partners.

In Ms. Yellen’s final week as chairwoman, the New York Fed encouraged supporters to thank her by posting photos of themselves on social media with their collars turned up, a nod to the jacket style she preferred.

And at a send-off for Ms. Yellen at the Fed’s headquarters Thursday, Mr. Powell paid tribute by observing that it would be hard not only to fill her shoes but also to pull off the “popped collar,” and he flipped up the collar on his suit jacket. Ms. Yellen posed for selfies with hundreds of Fed staffers, many with their collars up.

Write to Nick Timiraos at nick.timiraos@wsj.com



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *