A Behind the Scenes Federal Reserve Power Player is Exposed

Glenn Hutchins

There are always players behind the scenes of Washington D.C. power centers. They rarely come out of the shadows.

Bloomberg just outed a top behind the scenes power player involved in influencing the Federal Reserve

From Bloomberg:

John Williams has fans at the Hutchins Center on Fiscal and Monetary Policy, part of the
Brookings Institution think tank in Washington. When news leaked in March that he was the front-runner to lead the Federal Reserve Bank of New York, the group’s director, David Wessel, immediately lauded the potential move in an emailed reply to a reporter. When the formal announcement was made a week later, former Fed Chair Janet Yellen, an affiliate of the center, issued a glowing press release. Brookings posted an article detailing his contributions to the think tank.

Williams’s promotion from San Francisco district president was important for the Fed, because the New York chief is among the most powerful central bankers in the world. It was a big moment for the Hutchins Center, because Williams is Yellen’s protege and was a Fed colleague of another affiliate, former Chair Ben Bernanke. And it was consequential for Glenn Hutchins, the private-equity financier who launched the center with a $10 million donation five years ago. He co-led the New York Fed search committee that chose Williams.

In backing a haven for top Fed expats and guiding a personnel move that will shape monetary policy for years, Hutchins has exerted remarkable outside influence at the central bank—arguably more than any living financier. As the debate heats up over the Fed’s role in the economy, the center that bears his name is emerging as a thought leader in the field...

Bernanke and Yellen now share a hallway with former Fed Board Vice Chairman Donald Kohn. It’s a running joke at Brookings that their corridor is the “FOMC-Former Open Market Committee,” a play on the name of the policy-setting Federal Open Market Committee. Nellie Liang, the former director of the Fed Board’s financial stability division, is listed as a Hutchins Center expert. Louise Sheiner, a longtime Fed Board economist, is the center’s policy director.

Hutchins doesn’t see the center as a Fed booster. He views it as a forum for robust discussion and, in a conversation in his office in New York, he says his influence at both the Brookings center and the regional Fed is limited: A committee picked Williams—he just led it...

This guy needs to be monitored. In addition to sitting on the board of the Federal Reserve Bank of New York, he is a member of the Council on Foreign Relations. In 1992, he was on the Bill Clinton presidential transition team as a Senior Adviser focusing on economic policy.

He claims the book that changed his life is the horrific Paul Samuelson and William Nordhaus, Keynesian disaster, Economics.

-RW