Peter Diamond

Peter Arthur Diamond (born April 29, 1940) is an American economist known for his analysis of U.S. Social Security policy and his work as an advisor to the Advisory Council on Social Security in the late 1980s and 1990s. He was awarded the Nobel Memorial Prize in Economic Sciences in 2010, along with Dale T. Mortensen and Christopher A. Pissarides. He is an Institute Professor at the Massachusetts Institute of Technology. On June 6, 2011, he withdrew his nomination to serve on the Federal Reserve's board of governors, citing intractable Republican opposition for 14 months.

Diamond was born to a Jewish family in New York City. His grandparents immigrated to the U.S. at the turn of the 20th century. His mother's parents and six older siblings came from Poland. His father's parents met in New York, she came from Russia and he came from Romania. His parents, both born in 1908, grew up in New York City and never lived outside the metropolitan area. Both finished high school and went to work, his father studying at Brooklyn Law School at night while selling shoes during the day. They married in 1929. He has one brother, Richard, born in 1934.

He started public school in the Bronx, and switched to suburban public schools in the second grade when the family moved to Woodmere, on Long Island. He eventually graduated from Lawrence High School. He earned a bachelor's degree summa cum laude in mathematics from Yale University (1960), and a Ph.D. at the Massachusetts Institute of Technology (1963).

He was an assistant professor at the University of California, Berkeley, from 1963 to 1965 and an acting associate professor there before joining the MIT faculty as an associate professor in 1966. Diamond was promoted to full professor in 1970, served as head of the Department of Economics in 1985–86 and was named an Institute Professor in 1997.

In 1968, Diamond was elected a fellow and served as president of the Econometric Society. In 2003, he served as president of the American Economic Association. He is a Fellow of the American Academy of Arts and Sciences (1978), a member of the National Academy of Sciences (1984), and is a founding member of the National Academy of Social Insurance (1988). Diamond was the 2008 recipient of the Robert M. Ball Award for Outstanding Achievements in Social Insurance, awarded by NASI. As a Fulbright Distinguished Chair, in 2000 he taught economics at the University of Siena.

Diamond wrote a book on Social Security with Peter R. Orszag, President Obama's former director of the Office of Management and Budget, titled Saving Social security: a balanced approach (2004,-5, Brookings Institution Press). An earlier paper from Brookings Institution introduced their ideas.

In April 2010, Diamond, along with Janet Yellen and Sarah Bloom Raskin, was nominated by President Barack Obama to fill the vacancies on the Federal Reserve Board. In August 2010, the Senate returned Diamond's nomination to the White House, effectively rejecting his nomination. President Obama renominated him in September. In June 2011, following a third round of consideration for the Fed seat, Diamond wrote in a New York Times op-ed column that he planned to withdraw his name. In the column, he strongly criticized the nomination process and "partisan polarization" in Washington, saying he was effectively blocked by Republicans on the Senate Banking Committee. He also detailed the consideration process, saying that in the first and second rounds, three Republicans had favored his confirmation. In the third, when his name was resubmitted in January 2011, the Republicans all followed ranking minority member Shelby (R, Alabama) in voting against it. Diamond continued, quoting Shelby:

"Does Dr. Diamond have any experience in conducting monetary policy? No," [Shelby] said in March. "His academic work has been on pensions and labor market theory." But [Diamond began his reply, in the column] understanding the labor market—and the process by which workers and jobs come together and separate—is critical to devising an effective monetary policy.