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Senate Republicans on Tuesday blocked a committee vote on five of President Biden’s nominees to the Federal Reserve Board, delaying their confirmation at a time when the central bank is under increasing pressure to quell inflation.
Delayed nominations included Jerome Powell for a second term as Fed chairman, Lael Brainard as vice chairman and economists Lisa Cook and Philip Jefferson as Fed governors.
The blocking tactic targeted a fifth candidate – Sarah Bloom Raskin – who is Biden’s pick to be the Fed’s top banking regulator. Raskin has drawn opposition from Republicans for arguing that financial regulators should consider the risks posed by climate change.
GOP senators also say they want more answers about Raskin’s work with a Colorado fintech company.
By boycotting a Senate Banking Committee meeting on Tuesday, Republicans prevented the panel from holding a vote, at least for now.
“Instead of showing up to work to do their job, Republicans have walked out on the American people,” said Sen. Sherrod Brown, D-Ohio, chairman of the committee. “At this pivotal moment in the history of our economy, everyone understands that we need a [Federal] Reserve board.”
Brown defended Raskin, who won Senate confirmation for a previous term on the Fed’s board, as well as a top job at the Treasury Department. She is married to Rep. Jamie Raskin, D-Md.
“They can’t attack her on the merits, she’s so skilled, so they’ve been indulging in malicious character assassination and innuendo, without offering any real evidence,” Brown said.
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Raskin faces heat from Republicans
Senate Republicans have questioned whether Raskin improperly used her Federal Reserve connections to gain access to a main central bank account for Reserve Trust, a fintech company where she served on the board.
The main account provides access to the Fed’s payment system.
Raskin and the Federal Reserve Bank of Kansas City, which granted the company a primary account, denied any improper influence.
Sen. Pat Toomey, R-Pa., the top Republican on the Banking Committee, said he and his colleagues were ready to vote Tuesday on the other four nominees.
“Until the basic issues have been adequately addressed, I do not believe the Committee should proceed to a vote on Ms. Raskin,” Toomey said in a statement.
Toomey also warned that if confirmed to the Fed board, Raskin would “stifle credit” to fossil fuel companies, although Raskin told lawmakers during his confirmation hearing that he was up to banks, and not the Federal Reserve, to decide which companies they lend money to. .
The delay in the committee’s vote leaves three vacant seats on the Fed’s board. Additionally, Powell is in a temporary position, as his term as president expired earlier this month.
Fed policymakers are widely expected to start raising interest rates in an effort to reduce inflation at their next meeting in March. This meeting will continue, even if the confirmation impasse is not resolved by then.
Inflation is at its highest level in nearly four decades, with consumer prices up 7.5% in January from a year ago.
White House spokeswoman Jen Psaki called the Republicans’ decision to block the vote “completely irresponsible.”
“It has never been more important to have confirmed leadership at the Fed to help continue our recovery and fight inflation,” she said.