The Economy Is Humming, but That May Not Win Janet Yellen Another Term
Representative Jeb Hensarling, the Texas Republican who chairs the House Financial Services Committee, sent a letter to Ms. Yellen in February demanding
that the Fed stop crafting regulations until Mr. Trump appointed a new vice chairman for supervision.
John Williams, president of the San Francisco Fed, said
that Ms. Yellen had been effective in building a consensus about the direction of policy among Fed officials, and in communicating policy to the markets and the public.
On that short list: Gary D. Cohn, the president’s chief economic adviser; Jerome H. Powell, the only Republican on the Fed’s board of governors; John B. Taylor, a Stanford University economist who has criticized the Fed for raising interest rates too slowly;
and Kevin Warsh, a former Fed governor and a fellow at the Hoover Institution.
The Treasury secretary, Steven Mnuchin, has argued that installing a new Fed chairman would help Mr. Trump achieve his goal of reducing regulation.
Some of the other candidates, notably Mr. Taylor and Mr. Warsh, have argued the Fed should be raising interest rates more quickly.
But Mr. Trump also faces warnings that replacing Ms. Yellen is an unnecessary risk to the economic
growth the president has repeatedly pointed to as a primary success of his young administration.
The three previous Fed chairs were reappointed at least once by a president of the opposite political party,
but some Republicans are eager to oust Ms. Yellen, a registered Democrat who has strongly defended post-crisis financial regulations.
Yet President Trump, who is scheduled to meet Ms. Yellen on Thursday, says he is still considering whether to nominate her for a second four-year term,
and key White House aides are pressing for her to be replaced.