Washington, DC - The Club for Growth today announced its opposition to the nomination of Peter Diamond to the Federal Reserve Board of Governors and urged all Senators to vote "NO" on his confirmation. If Mr. Diamond's nomination comes to a vote, it will be included as a "Key Vote" in the Club for Growth's 2011 Congressional Scorecard. The Club for Growth has never opposed any Presidential nomination before. 

 

"One of the pillars of economic growth is a stable currency, and the responsibility for maintaining it lies with the Federal Reserve Board," said Club for Growth President Chris Chocola. "Peter Diamond is a known Keynesian who believes that government must take a much larger role in the economy. It is important for our economic future that Federal Reserve Board members support a monetary policy that curbs inflation and allows for our markets to thrive."

 

To see how members of Congress have done on previous Club for Growth scorecards, go to www.ClubForGrowth.org/projects.
 

 

Key Vote Alert

“NO” on Peter Diamond Nomination (PN 52)

May 10, 2011

 

The Club for Growth opposes the nomination of Peter Diamond to the Federal Reserve’s Board of Governors and urges all Senators to vote “NO” on his confirmation.  If his nomination comes to the floor for a vote, it will be included in the Club for Growth’s 2011 Congressional Scorecard.

 

One of the pillars of economic growth is stable money – the most important responsibility of the Federal Reserve Board.  It is critically important for economic growth and prosperity that Congress ensures the law is followed and confirms only governors who have the expertise and the will to support stable money.

 

While the Fed should be an independent institution to ensure sound money, Diamond is an activist-Keynesian who believes in a much larger role for government involvement in the economy.  Most notably, he supported a larger stimulus than the failed one that passed into law in 2009.  And he supports government-run healthcare administered through agencies similar to Fannie Mae and Freddie Mac.

 

Also, if confirmed by the Senate, Peter Diamond would represent a region, Chicago, in which he has absolutely no true relationship.  We believe this is a violation of the Federal Reserve Act, which says that members of the Board of Governors are supposed to represent different regions of the country.  No two Governors can be from the same region, and Daniel Tarullo already represents Boston, where Diamond resides.  This would set a new precedent that completely violates the intention of the Federal Reserve Act.  In fact, his nomination should be withdrawn for this reason.

 

Cabinet officials and other key executive branch appointments are assumed to be people who agree with the President.  However, the Federal Reserve Board is not an executive branch agency – in fact its authority is controlled by the congressional power to “regulate the Value [of Money]” derived from Article I Section 8 of the Constitution.  We believe that Congress should therefore apply a different standard of care for such nominations. 

 

Taking all of these points into consideration, we believe the Senate should reject Diamond’s nomination.

 

Our Congressional Scorecard for the 112th Congress provides a comprehensive rating of how well or how poorly each member of Congress supports pro-growth, free-market policies and will be distributed to our members and to the public.