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Alumna takes seat on New York Fed board

By Kari VanDerVeen
September 24, 2009

An internationally known expert in housing, economic development, and urban policy, Kathryn Wylde ’68 has spent much of her career working to strengthen and diversify New York City’s economy. She’ll continue those efforts as she settles into her new seat on the board that oversees the Federal Reserve’s most powerful regional reserve bank.
Kathryn Wylde '68 has been described as one of New York City's "most powerful advocates for business."

Wylde was recently appointed to the board of directors of the Federal Reserve Bank of New York, the largest of the 12 regional reserve banks that make up the Federal Reserve. She is one of nine members on the board and its only woman.

Described as one of New York City’s “most powerful advocates for business,” Wylde is the president and CEO of the nonprofit Partnership for New York City. The mission of the partnership, which is comprised of 200 business executives, is to enhance the city’s economy. Wylde has been with the organization since 1982, first as the head of affordable housing initiatives and later running its economic development arm — the $110 million New York City Investment Fund. Prior to joining the partnership she worked on a number of nonprofit housing and community development projects, as a bank community reinvestment officer, a low-income housing consultant, and as a senior executive at Lutheran Medical Center. She’s a civic leader who assisted in New York City’s recovery after Sept. 11, has championed the mayor’s sustainability initiatives, and helped lead the redevelopment of the federally designated poverty area of Sunset Park, Brooklyn.

A political science major at St. Olaf, Wylde served as editor of the Manitou Messenger and played viola in the St. Olaf Orchestra. She discusses her responsibilities with the New York Fed, why it will take New York longer to recover from the economic crisis than the rest of the country, and how St. Olaf prepared her for her career.

What are your responsibilities as a member of the board of directors of the Federal Reserve Bank of New York?
I am one of three directors who are appointed by the Federal Reserve Board of Governors to represent the public on this board. The nine-member board meets monthly with the president of the New York Fed, William Dudley, and his top staff. There are discussions of the economy, monetary policy, and right now a lot of attention is focused on the various programs that the Fed is managing to achieve stabilization and recovery of the financial system from the recent crisis. The board's primary duty is to select the New York Fed president and to provide him with information and feedback on the economy, conditions in the region, and other matters that are relevant to the financial system and monetary policy.

How has the work of the New York Fed been impacted by the financial crisis?
The crisis has required the Fed to make a huge investment in providing liquidity to the banking system through its own resources and in helping to administer and partially fund federal programs that were put in place to save the banking system. The staff has been increased, responsibilities have grown, and the Fed is working intensively with the U.S. Department of Treasury on a wide range of programs and issues that are critical to the future of the economy. Going forward, the Fed will likely help design and run a system for managing risks in order to prevent another crisis in the banking system, both nationally and globally.
 
While analysts predict that the national economy will begin improving in 2010, you've said it will take several years longer for New York to see much improvement. Why?
Financial services represents a third of New York's economy and at least 20 percent of our tax base. This industry is the linchpin in sustaining New York's role as a global center of economic power. Right now, financial services firms are mostly downsizing and restructuring to reflect the diminished level of economic activity brought on by the recession. This comes down hard on New York, where the unemployment rate has risen to 10.3 percent. Looking ahead, there is uncertainty over how changes in the U.S. tax, regulatory, and corporate governance policies will affect our competitive position in global markets. Media and retail are two other important industries in New York that are suffering due to falloff in both consumer spending and advertising. Sources of future job growth will likely come from emerging sectors in technology, renewable energy, and other innovation industries that will take a while to develop. We have great leadership in the public and private sectors, so I am confident that New York will remain a leading world city over the long term, but the next few years will be tough.

You've worked on initiatives in a wide variety of areas — from affordable housing to the New York Public Schools to sustainability. What have you enjoyed the most?
Helping to organize the rebuilding and renaissance of the city's most blighted neighborhoods in the 1980s and '90s was the most gratifying work I ever did. There are tens of thousands of affordable homes and community development projects that the Partnership for New York City was responsible for bringing to life across the city. Many of the public-private initiatives we created were replicated in other urban centers around the country. Today, the work we are engaged with in public education and sustainability is equally important, but you can't see immediate results. These are investments where the returns are a ways down the road.

How did St. Olaf prepare you for your career?
St. Olaf is where I defined and fully embraced the values and priorities that have guided my professional life. In every field of study — political science, philosophy, religion, literature — the educational experience was both deeply personal and had broad societal implications. The St. Olaf faculty is amazing. I was lucky to have faculty mentors in Pam and Jack Schwandt and to study under Howard Hong, Lowell Johnson, Vernon Faillettaz and many other great teachers.

What advice would you give St. Olaf students interested in a career in today's financial industry?
Success in the financial industry requires more humility today than it has in the past few decades. Government oversight will trim the sails of industry professionals for some time to come. Patience for longer-term rewards will be the order of the day. The greatest opportunities will be in small, entrepreneurial firms that are cropping up to serve emerging markets. Learn Mandarin!

Contact Kari VanDerVeen at 507-786-3970 or vanderve@stolaf.edu.