Brainard's multiple dissents break from Fed's nearly decade-old practice

15 March 2019 9:11pm
Democratic US Federal Reserve Governor Lael Brainard has broken from the central bank’s practice of consensus decision-making, casting multiple dissents in the past year that push back against Trump appointees’ deregulatory agenda.

Brainard has dissented four times since last April, including twice this month, breaking a streak of 337 unanimous Fed votes on regulatory and enforcement matters dating to 2011.

“The old regime of no dissent was unhealthy,” Darrell Duffie, a Stanford University finance professor, said in an interview. “In those days, a dissent was so unprecedented that a governor might have avoided a valid dissent merely in order to avoid the appearance of a big change in the character of the Board.”

A difference of opinions is nothing new for the Fed, according to Karen Shaw Petrou, a banking consultant at Federal Financial Analytics. Post-financial-crisis rules were hotly debated, she said, but issues were typically resolved prior to board votes, which allowed the decisions to appear unanimous.