There is no opposition to Janet Yellen rising from Vice Chairman of the United States Federal Reserve Board to Chairman. Nobody claims she is unqualified. Nobody claims that she will do a bad job. Nobody claims that she is not a monetary policy expert. She even has high profile supporters in and around the U.S. government. But she doesn’t have the job.
There is, it seems, some typecasting at work. The gray, male eminence at the helm of the Federal Reserve is a tough habit to break. A woman in line for a key role that straddles the old boys clubs on Wall Street and Washington and gives her critical authority to make decisions that impact the global economy is scrutinized more than any male candidate, both by critics and supporters, even as both sides claim that gender has nothing to do with it.
New York Times columnist Paul Krugman dilutes it down to two sexist campaigns: “One is a whisper campaign whose sexism is implicit, while the other involves raw misogyny.”
The underlying or hidden sexism exists at a far deeper level than any whispering done behind closed doors. Even as Yellen competes for the most powerful position in her career, she faces the same underlying discrimination as any other woman in business or finance.
A study by University of Pennsylvania Professor Janice Fanning Madden found that women stockbrokers tend to receive inferior accounts and sales opportunities compared to their male colleagues, which results in lower salaries. About 1 in 3 full-time stockbrokers are women, and they generally earn two-thirds of the salaries of their male colleagues. Madden declined to comment on what role sexism plays in Yellen’s chances of being appointed.
“I do believe that if Yellen were a man, her chances would be a lot better, simply as a result of the preconceived notion — among men and, unfortunately, women — that anyone taking on such a powerful role should be someone with ‘gravitas’ – namely, a man,” said City banker turned novelist Polly Courtney.
In her own banking career, Courtney said “it was clear to me throughout my time in the City (both in Wall Street, where I trained, and in the City of London, where I worked) that there is an inherent sexism that runs through the fabric of the place. It takes various forms.”
Sexism is a reality for all women in banking, even if few cases are reported, and is rampant worldwide.
There are some famous gaffes. Wim Duisenberg, then chief of the Dutch central bank, welcomed “everyone — and Ms. Phillips” to a dinner with key policy makers in Basel, Switzerland. Susan Phillips, who had served as a Federal Reserve governor from 1991 to 1998, was the only woman in the room.
Little has changed since then, and while women have held central bank positions for years, Yellen could be the first woman to hold a post that is essentially second only to president when it comes to making policy with widespread impact.
IMF Chief Christine Lagarde, who counts Yellen as a friend, has faced her share of open gender attacks. It was her youthful prowess as a synchronized swimmer rather than her experience as a lawyer that garnered headlines when she moved up the ranks to become the first female finance minister of a G8 economy.
Despite being named “Best in Financial Services Sector” by the U.K. charity Working Families and making the Working Mother magazine’s “100 Best Companies” list 13 times since 1996, Deutsche Bank has been repeatedly sued for harassment, retaliation, gender bias and discrimination against pregnant women.
Yosefa Shliselberg, a director in the global transaction banking group, claims that she was fired two months after she complained to HR about gender discrimination and sexual harassment. Less than two weeks before Shliselberg filed her lawsuit in January, Heather Zhao, a vice president in the global investment solutions group, was fired nine days before she was scheduled to return from maternity leave. Zhao’s suit includes quotes from male colleagues such as: “Maybe I should get pregnant so I can work from home.” In another ongoing legal battle, Kelley Voelker, who lost her job as vice president on the securities-lending desk, amended her complaint after suing the bank for pregnancy discrimination in 2011, to say that the bank retaliated by firing her.
There have been high profile cases against big banks, but with little real consequence or change.
In 2007, Dresdner Kleinwort settled, for an undisclosed amount, a $1.4 billion sex discrimination lawsuit by six women that claimed unfair and abusive treatment and that women were hired as “eye candy,” including the “Pamela Anderson of trading.”
In March, a New York appeals court ruled that a former managing director could not file a class action lawsuit against Goldman Sachs for sex discrimination because she had signed a contract agreement to arbitrate employment disputes.
In 2010, Nomura International won two Employment Tribunal cases brought by female staff alleging sex discrimination, racial discrimination and unfair dismissal.
In Yellen’s uphill battle for Bernanke’s job, there is the obvious criticism from men, much of which is being solicited.
Why was Richard W. Fisher, president and CEO of the Federal Reserve Bank of Dallas, even asked by Andrew Ross Sorkin on CNBC’s Squawk Box to weigh in on Yellen’s odds?
Fisher said he’s worried that the choice of chair would be “driven by gender,” all while acknowledging that Yellen is “extremely capable.”
Even support among women is punctuated by an unprecedented push to name a woman to head the Fed. About a third of the Senate’s 53 Democrats, including Sens. Barbara Boxer and Dianne Feinstein, of California, and Elizabeth Warren, of Massachusetts, signed a letter urging President Obama to pick Yellen.
Her resume and record as Fed Vice Chairwoman, President and CEO of the Federal Reserve Bank of San Francisco, Chair of the White House Council of Economic Advisers under President Bill Clinton and Professor Emerita at the University of California, Berkeley’s Haas School of Business should alone be enough to qualify her for the upgrade. But even her most influential women backers are making the case based on her gender.
“The president has an incredible opportunity here to make history by choosing someone who has the right experience, has consistently made the right calls and has the right perspective and judgment to continue our economic recovery,” Boxer said.
“I just think she’s the best-suited for the job right now — and it would be nice to have a woman,” Feinstein said.
Perhaps these women are speaking loudly to overcompensate for Yellen’s soft-spoken demeanor, a girlish quality that detractors can quickly point to as a reason she’s unqualified to follow Gentle Ben, or her stance as a “dove” — someone more concerned with unemployment than with inflation.
Last week the White House said Obama will nominate Federal Reserve Governor Sarah Bloom Raskin as second-in-command of the U.S. Treasury Department.
The timely announcement detracts from Obama’s obvious choice for Fed Chairman, Yellen’s top rival, Larry Summers, who got close to the president while serving as his top economic adviser in 2009-2010.
There is far more banter about Yellen’s gender than Summer’s conflicts of interest.
Summers consults for major financial firms, such as DE Shaw, Andreessen Horowitz, Alliance Partners, Nasdaq OMX Group and Citigroup, all while raking in money speaking at conferences.
Summers is a well-oiled machine in tightly knit political and financial circles, yet his cronyism is hardly whispered about.
In an Aug. 6 interview, Sorkin stumbled on his words, stressing the “man” in chairman when introducing former FDIC Chair Sheila Bair on CNBC, making it sound as if serving as chairwoman would be a different role than chairman.
Bair noted that there is a “horrible whispering campaign in Washington” against Yellen. Bair made the case that Yellen is “best qualified for the job” because she has “deep experience, very well-respected, great public image. She’s not part of the Wall Street club that we’ve drawn a lot from that group in key financial positions.” She also stressed that the case against Yellen has been “tinged with sexist arguments,” such as: ‘Wouldn’t be good in a crisis. Lacks gravitas.”
But Yellen already has proven she is good in a crisis. Consider what she’s done over the last two decades. She talked Alan Greenspan out of a zero percent inflation target in the mid-1990s, essentially predicted the housing bubble in the mid-2000s and warned of a credit crunch in 2007. Since the crisis, let’s not forget that the doves have been beating the hawks as inflation prediction after inflation prediction has failed.
Rather than joining the chorus, whether it’s men like Washington Post columnist Ezra Klein writing about the “subtle, sexist whispering campaign” against Janet Yellen, or other women in top ranks belaboring the role of softly spoken sexism, why not speak less of gender and more of record?
The hidden sexism won’t stop just because there is a noisy clamor to claim a gender bias.
Follow the author on Twitter @natashagural