Minneapolis Fed Taps Neel Kashkari as New President

Neel Kashkari, a key architect of the government rescue of the banking industry during the financial crisis and recent candidate for governor of California, will be the 13th president of the Federal Reserve Bank of Minneapolis.

Kashkari will replace Narayana Kocherlakota on Jan. 1. He will serve on the Fed’s powerful Open Market Committee, which sets interest rates, and oversee 1,100 employees in Minneapolis and Helena, Mont., who administer bank regulations and payments, provide economic research and boost development in the six states of the Fed’s Ninth District.

The appointment of the 42-year-old Ohio native is a major departure for the Minneapolis Fed, which has been run by academic economists since 1985. Kashkari is not an economist but was a central actor during the biggest economic crisis since the Great Depression.

“There are world-class people here, and if I’m able to tap into their best ideas and focus on issues that are important to the district and important to the country, I think we can make a big, big difference,” Kashkari said in an interview with the Star Tribune.

Kashkari worked for Hank Paulson at the U.S. Treasury, where he developed and ran the Troubled Asset Relief Program, the bailout of the financial industry and others after the subprime mortgage crisis.

He retreated from Washington a few months into President Obama’s first term and has since worked in finance and run for governor of California as a Republican, losing to Jerry Brown in 2014.