President Barack Obama finally settled on Janet Yellen to succeed Ben Bernanke as the next chair of the Federal Reserve. No woman has previously held that position, nor has any previous nominee for the job been as qualified as Yellen. Binyamin Appelbaum’s profile of Yellen for the New York Times is excellent. Some other good links about her views are here. She is commonly described as an “inflation dove,” meaning that in her opinion, reducing unemployment should be a higher priority than keeping inflation low (the traditional obsession of Fed chairs). A few years ago, Bleeding Heartland user PrairieBreezeCheeze discussed why it’s time for a Fed chair willing to prioritize employment. Even now, long-term unemployment is still near historically high levels.

Nobody’s perfect, and Zach Carter offers a more negative take on Yellen, focusing on her support for NAFTA, a chained Consumer Price Index, and repealing the Glass-Steagall Act during the 1990s. Nevertheless, Yellen is a much better person to run the Fed than Obama’s first choice for the job, Larry Summers. Credit goes to the coalition that came out early against Summers, convincing five Democrats on the Senate Banking Committee to oppose him.

Despite today’s news, President Obama’s record on appointing women to cabinet-level positions remains worse than Bill Clinton’s–and not for lack of qualified women to choose from.

UPDATE: After the jump I’ve added some remarks from President Obama and Yellen at today’s press conference. SECOND UPDATE: Added Senator Tom Harkin’s official comment.

Excerpts from October 9 press conference at the White House:

THE PRESIDENT: […]

Now, as I’ve said, the decision on who will succeed Ben is one of the most important economic decisions that I’ll make as President — one of the most important appointments that any President can make — because the chair of the Fed is one of the most important policymakers in the world, and the next chair will help guide our economy after I’ve left office.

I’ve considered a lot of factors.  Foremost among them is an understanding of the Fed’s dual mandate — sound monetary policy to make sure that we keep inflation in check, but also increasing employment and creating jobs, which remains our most important economic challenge right now.

And I’ve found these qualities in Janet Yellen.  She’s a proven leader and she’s tough — not just because she’s from Brooklyn.  (Laughter.)  Janet is exceptionally well-qualified for this role.  She’s served in leadership positions at the Fed for more than a decade.  As Vice Chair for the past three years, she’s been exemplary and a driving force of policies to help boost our economic recovery.

Janet is renowned for her good judgment.  She sounded the alarm early about the housing bubble, about excesses in the financial sector, and about the risks of a major recession.  She doesn’t have a crystal ball, but what she does have is a keen understanding about how markets and the economy work — not just in theory but also in the real world.  And she calls it like she sees it.

Janet also knows how to build consensus.  She listens to competing views and brings people together around a common goal. And as one of her admirers says, “She’s the kind of person who makes everybody around her better.”  Not surprisingly, she is held in high esteem by colleagues across the country and around the world who look to the United States, as I said, and the Fed for leadership.

Janet is committed to both sides of the Fed’s dual mandate, and she understands the necessity of a stable financial system where we move ahead with the reforms that we’ve begun — to protect consumers, to ensure that no institution is too big to fail, and to make sure that taxpayers are never again left holding the bag because of the mistakes of the reckless few.  

And at the same time, she’s committed to increasing employment, and she understands the human costs when Americans can’t find a job.  She has said before, “These are not just statistics to me.  The toll is simply terrible on the mental and physical health of workers, on their marriages, on their children.”  So Janet understands this.  And America’s workers and their families will have a champion in Janet Yellen.

So, Janet, I thank you for taking on this new assignment.  And given the urgent economic challenges facing our nation, I urge the Senate to confirm Janet without delay.  I am absolutely confident that she will be an exceptional chair of the Federal Reserve.  I should add that she’ll be the first woman to lead the Fed in its 100-year history.  And I know a lot of Americans — men and women — thank you for not only your example and your excellence, but also being a role model for a lot of folks out there.  

It’s been said that Janet found love at the Federal Reserve — literally.  (Laughter.)  This is where she met her husband George, a celebrated economist in his own right.  And their son Robert is an economist as well.  So you can imagine the conversations around the dinner table might be a little different than ours.  (Laughter.)  In fact, I’ve been told their idea of a great family vacation is the beach — with a suitcase full of economics books.  (Laughter.)  But this is a family affair.  We thank George and Robert for their support as Janet begins this journey.

[…]

DR. YELLEN:  Thank you, Mr. President.  I’m honored and humbled by the faith that you’ve placed in me.  If confirmed by the Senate, I pledge to do my upmost to keep that trust and meet the great responsibilities that Congress has entrusted to the Federal Reserve — to promote maximum employment, stable prices, and a strong and stable financial system.

I’d also like to thank my spouse, George, and my son, Robert.  I couldn’t imagine taking on this new challenge without their love and support.

The past six years have been tumultuous for the economy and challenging for many Americans.  While I think we all agree, Mr. President, that more needs to be done to strengthen the recovery, particularly for those hardest hit by the Great Recession, we have made progress.  The economy is stronger and the financial system sounder.

As you said, Mr. President, considerable credit for that goes to Chairman Bernanke, for his wise, courageous and skillful leadership.  It has been my privilege to serve with him and learn from him.

While we have made progress, we have farther to go.  The mandate of the Federal Reserve is to serve all the American people, and too many Americans still can’t find a job and worry how they’ll pay their bills and provide for their families.  The Federal Reserve can help if it does its job effectively.  We can help ensure that everyone has the opportunity to work hard and build a better life.  We can ensure that inflation remains in check and doesn’t undermine the benefits of a growing economy.

We can, and must, safeguard the financial system.

The Fed has powerful tools to influence the economy and the financial system.  But I believe its greatest strength rests in its capacity to approach important decisions with expertise and objectivity, to vigorously debate diverse views and then to unite behind its response.

The Fed’s effectiveness depends on the commitment, ingenuity and integrity of the Fed staff and my fellow policymakers.  They serve America with great dedication.

Statement from Senator Tom Harkin, October 9:

“Janet Yellen has the experience, foresight, and temperament that our country needs in a Federal Reserve Chair.  She has long recognized that the Fed’s mandate is not just to produce stable prices, but also to promote full employment.  She saw problems in the housing market before the financial crisis hit.  She understands how to marshal the Federal Reserve Board.  In nearly every regard, she has the capacity to boldly address the issues critical to our economic recovery.  

“Also, it is long past time for a woman to enter the ranks of the nation’s highest economic policy makers.  I welcome this nomination.”