Sen. Elizabeth Warren (D-Mass.) on Tuesday said she would oppose giving Jerome H. Powell a second term as chair of the Federal Reserve, calling him a “dangerous man,” raising the political stakes around a major nomination decision for the Biden administration.
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At a Tuesday hearing of the Senate Banking Committee, Warren pointed to Powell’s record on banking regulation and steps taken by the central bank to ease rules on the banking system put in place after the Great Recession.
Weighing Fed nominees, Biden administration faces delicate political test
“Your record gives me grave concern," Warren told Powell. "And that makes you a dangerous man to head up the Fed, and it’s why I will oppose your renomination.”
Warren did not specifically endorse other candidates. But she has previously praised Fed Gov. Lael Brainard, the Fed board’s lone Democrat, who has consistently voted against the Fed’s moves to soften banking regulation and warned of the dangers of less Wall Street oversight, even when the economy is healthy.
Warren had previously signaled her displeasure with Powell’s stewardship of the Fed, but Tuesday marked her sharpest remarks yet. It’s not clear how Warren’s opposition will factor into the Biden administration’s decision making. But the White House — and the Fed — would likely want to avoid a heated political fight over the central bank’s leadership. The Senate Banking Committee, of which Warren is a member, vets and votes on nominations to the Federal Reserve before nominees continue on to full Senate confirmation vote, where Democrats hold a razor-thin majority.
Powell’s term is up in February, and the White House has not signaled whether it will reappoint him to a second term as chair. The Biden administration can fill up to four openings at the Fed in the coming months, and there’s growing expectation that the White House will unveil a package of nominations at the same time.
As Biden considers pick to run the Fed, key Wall Street oversight role slips under radar
Powell has garnered support from Republicans and Democrats, especially for his leadership of the Fed during the covid crisis. He has been the most public face of the Fed’s sprawling policy response to bolster the financial system and encourage Congress to keep up its economic supports.
During an exchange with Warren during Tuesday’s hearing, Powell showed a willingness to revisit regulatory changes made under his leadership.
“I’m prepared to look at anything we did as fair game to look at again,” Powell told Warren.
Sen. Sherrod Brown (D-Ohio) is considered another possible Democrat on the Senate Banking Committee to push back on Powell’s nomination, though he has not shared his position publicly. So far, Sen. Jon Tester (D-Mont.) has come out in support of Powell’s renomination, along with Sen. Jack Reed (D-R.I.).
Powell has come under fire from progressive groups and some members of Congress, including Reps. Alexandria Ocasio-Cortez (D-N.Y), Rashida Tlaib (D-Mich.) and Ayanna Pressley (D-Mass.), for weakening rules on the banking system and not doing enough to combat or examine climate-related risk.
The White House must also decide whom to nominate to be the Fed’s top banking cop after Randal Quarles, whose term as vice chair for supervision expires in mid-October. Some liberal advocacy groups and Warren have raised concerns that a more left-leaning banking cop would not be as effective under Powell if he stays on as chair.
Other Fed watchers disagree, saying Powell respects the authority of whoever is in that role — as he did with Daniel Tarullo, a Democrat who led the Fed’s moves to tighten Wall Street oversight when Janet L. Yellen, now the treasury secretary, was chair.
“It’s fully appropriate for a new person to come in and look at the current state of [regulatory policy] and suggest appropriate changes, and I welcome that,” Powell said last week.
Government shutdown? Here's what to know about Thursday's deadline and what might follow
At a Tuesday hearing of the Senate Banking Committee, Warren pointed to Powell’s record on banking regulation and steps taken by the central bank to ease rules on the banking system put in place after the Great Recession.
Weighing Fed nominees, Biden administration faces delicate political test
“Your record gives me grave concern," Warren told Powell. "And that makes you a dangerous man to head up the Fed, and it’s why I will oppose your renomination.”
Warren did not specifically endorse other candidates. But she has previously praised Fed Gov. Lael Brainard, the Fed board’s lone Democrat, who has consistently voted against the Fed’s moves to soften banking regulation and warned of the dangers of less Wall Street oversight, even when the economy is healthy.
Warren had previously signaled her displeasure with Powell’s stewardship of the Fed, but Tuesday marked her sharpest remarks yet. It’s not clear how Warren’s opposition will factor into the Biden administration’s decision making. But the White House — and the Fed — would likely want to avoid a heated political fight over the central bank’s leadership. The Senate Banking Committee, of which Warren is a member, vets and votes on nominations to the Federal Reserve before nominees continue on to full Senate confirmation vote, where Democrats hold a razor-thin majority.
Powell’s term is up in February, and the White House has not signaled whether it will reappoint him to a second term as chair. The Biden administration can fill up to four openings at the Fed in the coming months, and there’s growing expectation that the White House will unveil a package of nominations at the same time.
As Biden considers pick to run the Fed, key Wall Street oversight role slips under radar
Powell has garnered support from Republicans and Democrats, especially for his leadership of the Fed during the covid crisis. He has been the most public face of the Fed’s sprawling policy response to bolster the financial system and encourage Congress to keep up its economic supports.
During an exchange with Warren during Tuesday’s hearing, Powell showed a willingness to revisit regulatory changes made under his leadership.
“I’m prepared to look at anything we did as fair game to look at again,” Powell told Warren.
Sen. Sherrod Brown (D-Ohio) is considered another possible Democrat on the Senate Banking Committee to push back on Powell’s nomination, though he has not shared his position publicly. So far, Sen. Jon Tester (D-Mont.) has come out in support of Powell’s renomination, along with Sen. Jack Reed (D-R.I.).
Powell has come under fire from progressive groups and some members of Congress, including Reps. Alexandria Ocasio-Cortez (D-N.Y), Rashida Tlaib (D-Mich.) and Ayanna Pressley (D-Mass.), for weakening rules on the banking system and not doing enough to combat or examine climate-related risk.
The White House must also decide whom to nominate to be the Fed’s top banking cop after Randal Quarles, whose term as vice chair for supervision expires in mid-October. Some liberal advocacy groups and Warren have raised concerns that a more left-leaning banking cop would not be as effective under Powell if he stays on as chair.
Other Fed watchers disagree, saying Powell respects the authority of whoever is in that role — as he did with Daniel Tarullo, a Democrat who led the Fed’s moves to tighten Wall Street oversight when Janet L. Yellen, now the treasury secretary, was chair.
“It’s fully appropriate for a new person to come in and look at the current state of [regulatory policy] and suggest appropriate changes, and I welcome that,” Powell said last week.
