Obama to renominate MIT’s Diamond to Fed

By Reuters
Posted Dec. 23, 2010 at 11:38 a.m.

President Barack Obama will renominate Nobel-prize winning economist Peter Diamond to the Federal Reserve Board next year when the new Senate convenes, a White House official said Thursday.

The Senate scuttled Diamond’s nomination Wednesday by failing to vote on it before adjourning its lame duck session for the year.

The White House official offered no further details on the plan to renominate the Massachusetts Institute of Technology professor in the new Senate, which will have a larger Republican minority.

Diamond has strong expertise on budget and tax issues, but his research focus prompted criticism from some Republicans who argued he lacked the proper experience on monetary policy. Diamond has been unusually vocal on a wide range of topics for a nomineeĀ  in limbo. He expressed his opposition to extending Bush-era tax cuts for the wealthy in an interview with Reuters last month, saying “it would not be good policy.”

Despite such criticism, echoed by many Democrats, the tax cuts were passed as part of a deal between the White House and Republicans that will also extend emergency unemployment benefits and reduce payroll taxes.

The U.S. Senate Banking Committee had approved Diamond’s nomination in November, sending it for a full Senate vote three months after his appointment had first been blocked. The Senate completed its work for the current Congress without acting on the nomination again.

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