Treasury Secretary Proposes Fed Presidents Reside in Their Districts

NEW YORK, NY — Treasury Secretary Scott Bessent announced Wednesday his intention to require that the presidents of the Federal Reserve‘s regional banks live in their respective districts for at least three years before taking office. This proposal may increase the White House’s influence over the independent agency.

During his remarks at the New York Times’ DealBook Summit, Bessent criticized current Fed presidents, noting that some were not from the areas they represent. He stated, “a disconnect from the original framing” of the Fed can occur when presidents are not rooted in their districts.

Notably, Bessent pointed out that three of the 12 regional presidents have strong ties to New York: two previously worked at the New York Federal Reserve, while another was affiliated with a New York investment bank. “So, do they represent their district?” he questioned.

He explained, “I am going to start advocating, going forward, not retroactively, that regional Fed presidents must have lived in their district for at least three years.” Bessent was uncertain if Congress would need to be involved in this change.

Current law allows the Fed’s D.C.-based board to block appointments of regional presidents. Bessent suggested that if someone has not lived in a district for the required period, the appointment would be vetoed: “I believe that you would just say, unless someone’s lived in the district for three years, we’re going to veto them.”

This proposal follows a series of speeches where several Fed presidents expressed opposition to lowering interest rates at the upcoming December meeting, a stance that has drawn criticism from President Trump.

When the Fed cuts rates, borrowing costs for mortgages, auto loans, and credit cards typically decrease over time.