NYT : Edward Gramlich, 68, Dies; Former Fed Governor

Edward Gramlich, 68, Dies; Former Fed Governor

By MICHELINE MAYNARD | September 5, 2007

ANN ARBOR, Mich., Sept. 5 — Edward M. Gramlich, a former governor of the Federal Reserve who foresaw a looming crisis in home mortgage practices, and who ran a federal board created to aid the airlines after the September 2001 attacks, died today in Washington. He was 68.

Mr. Gramlich’s death, of acute myeloid leukemia, was confirmed by the Federal Reserve. Last month, Mr. Gramlich discontinued treatment for the disease, and on Friday he entered the Washington Home and Community Hospices, where his death took place.

Mr. Gramlich, whose illness was diagnosed in March after he returned from a trip to Africa, discussed his decision not to undergo experimental treatment in an article in the New York Times on Aug. 18.

Most recently a senior fellow at the Urban Institute in Washington, Mr. Gramlich had a career spanning the academic and government worlds.

At the University of Michigan in Ann Arbor, he was a professor of economics, headed its public institute, where he was a professor of economics, headed its public policy institute, and served as interim provost in 2005 and 2006.

He was named to the Federal Reserve by President Clinton in 1997, and served until 2005.

“His contributions to the Federal Reserve were broad and significant,” Ben S. Bernanke, the chairman of the Federal Reserve, said in a statement today.

As chairman of the Neighborhood Reinvestment Corporation, he urged legislators to better protect consumers against predatory lenders, and toughen regulation of mortgage lenders and banks.

Nonetheless, his efforts met resistance within the Fed and on Capitol Hill, and he admitted he could have pushed earlier for reform.

In June, the Urban Institute published his book, “Subprime Mortgages: America’s Latest Boom and Bust,” which offered solutions for the mortgage crisis.

Mr. Gramlich stirred unusual controversy for a Fed member as chairman of the Air Transportation Stabilization Board, created by Congress to oversee loan guarantees for the struggling airlines after the 2001 terrorist attacks in Washington and New York.

Mr. Gramlich twice voted with other board members to reject a loan package for United Airlines, which lost two planes in the attacks, and argued it needed the loans in order to restructure.

United filed for bankruptcy protection after its first application was rejected, and ultimately emerged from bankruptcy last year, without a loan package.

Mr. Gramlich is survived by his wife, Ruth; a son, Robert; a daughter, Sarah; and six grandchildren.