Story perspectives

New Fed Residency Rule Aims to Strengthen Local Ties

12/4/2025

Center

Bessent Restructures Fed

U.S. Treasury Secretary Scott Bessent announced a plan requiring regional Federal Reserve presidents to reside in their districts for at least three years.
At the New York Times DealBook Summit, Bessent argued outside appointments undermine the Fed's original intent and that the Fed's Board of Governors could veto noncompliant candidates.
The proposal follows Atlanta Fed President Raphael Bostic's upcoming departure and reflects Bessent's push to simplify Fed operations amid concerns about complexity.

Right

Trump Selects Fed Successor

U.S. President Donald Trump announced he has chosen a successor to Federal Reserve Chair Jerome Powell.
Trump has criticized Jerome Powell for not cutting interest rates quickly enough.
Kevin Hassett, Trump's top economic advisor, is the frontrunner under scrutiny.
Scott Bessent, the Treasury Secretary, has finalized a shortlist of candidates.
The selection is set against affordability concerns, with inflation above target and unemployment at 4.4%.

History

Historical Context

The Federal Reserve Act, enacted on December 23, 1913, established the Federal Reserve System in response to the Panic of 1907, aiming to stabilize the U.S. financial system. It created twelve regional banks to enhance local representation and regulate monetary policy. Scott Bessent's recent proposal to require Fed presidents to reside in their districts reflects this original intent amid current inflation challenges of 4.4%.

1 of 3

Bessent Restructures Fed

U.S. Treasury Secretary Scott Bessent announced a plan requiring regional Federal Reserve presidents to reside in their districts for at least three years.
At the New York Times DealBook Summit, Bessent argued outside appointments undermine the Fed's original intent and that the Fed's Board of Governors could veto noncompliant candidates.
The proposal follows Atlanta Fed President Raphael Bostic's upcoming departure and reflects Bessent's push to simplify Fed operations amid concerns about complexity.

1 / 3