Federal Reserve Chair Janet Yellen’s defense of the central bank as non-partisan came under attack on Wednesday, as a Republican congressman cornered her on whether a key policy maker would have a conflict of interest in discussing a post in the next U.S. president’s administration.
Fed Governor Lael Brainard has donated to Clinton’s campaign and is widely viewed as a potential Clinton pick for Treasury secretary. Yellen hesitated and then demurred when Rep. Scott Garrett of New Jersey asked whether Brainard would have a conflict of interest if she were indeed in talks with Democratic nominee Hillary Clinton’s campaign about a position. The election takes place Nov. 8.
“I would have to consult my counsel, I’m not aware that that’s a conflict,” Yellen said in testimony to the House Financial Services Committee in Washington, while rejecting Garrett’s suggestion that the U.S. central bank has a political bias.
“What’s important to me is whether or not, in our decision making, our collective decision making, I see politics being brought to bear in reasoning about our decisions, and I have never seen that with any of my colleagues,” she said after she was questioned about Brainard’s possible political conflicts.
The heated exchange came during a week when the Fed has been under fire for its politics: Republican Presidential nominee Donald Trump said that the Fed is keeping rates low to make President Barack Obama look good during a widely-viewed televised debate on Monday. Merited or not, the persistent questioning of the Fed’s objectivity — and Yellen’s inability to deflect that skepticism — could become a headache for the officially non-partisan and independent central bank.