Elizabeth Warren Says She Will Oppose Jerome Powell’s Nomination


Senator Elizabeth Warren, the Democrat of Massachusetts, said Monday that she would not vote to confirm Jerome H. Powell for a second term as chairman of the Federal Reserve, citing “regulatory, climate and ethical failures.”

Mrs Warren, who has called Mr Powell a “dangerous man”, had urged President Biden to appoint Lael Brainard as the next chairman of the central bank. Mr Biden’s decision to appoint Ms. Brainard to second place on the Fed attracted Ms. Warren’s support, but she said she would continue to push for additional governors to support aggressive financial regulation.

“It is no secret that I am against the appointment of Chairman Jerome Powell and I will be voting against him,” Ms. Warren said in a statement.

Other powerful Democrats, along with Republican lawmakers, expressed their support for Mr Biden’s decision, saying it would keep the central bank on a steady course and protect its political independence in a time of inflation and economic uncertainty for the country.

Senator Sherrod Brown, Democrat of Ohio and chairman of the Senate Banking Committee that oversees the Fed, praised Mr. Powell’s role in helping the labor market heal from the pandemic and giving workers greater bargaining power over higher wages.

“The Federal Reserve must continue to help steer our economic recovery in the right direction – towards full employment and an economy that empowers workers and their families,” said Brown. “I look forward to working with Powell to stand up to Wall Street and stand up for workers to share in the wealth they create.”

Senator Jon Tester, a Democrat from Montana, said on Twitter that the decision was “a smart move.”

Mr Biden’s decision to reappoint Mr Powell, who was first appointed by former President Donald J. Trump, is returning the country to a long tradition of using presidents of both parties as the expression of the Fed chairmen chosen by their predecessors have embraced support for the central bank’s political independence. Mr. Trump defied tradition and replaced Janet L. Yellen with Mr. Powell in 2018.

Some progressive Democrats had urged Mr. Biden to also break with tradition and appoint someone else for the role. In addition to Ms. Warren, Senators Sheldon Whitehouse from Rhode Island and Jeff Merkley from Oregon had called for Mr. Powell’s replacement and cited his views on climate change, financial regulation and an ethics scandal at the central bank.

Mr Whitehouse said in a statement Monday that he was “disappointed” with the decision, adding that Mr Powell had done too little to address climate change.

“Our Fed chairman needs to pay immediate and thorough attention to the climate threat before it is too late,” Whitehouse said in the statement. “I sincerely hope that if confirmed, Powell will reconsider his previous opposition to using Fed regulatory tools to minimize climate-related risks to the financial sector.”

Americans for Financial Reform, a coalition of civil rights, labor and civil rights groups, called the decision “a huge disappointment for those of us who have fought for tighter regulation on Wall Street.”

Mr Biden’s decision to appoint Mrs Brainard as Vice-Chair could help to allay some of these concerns. Some progressive groups had urged Ms. Brainard to run the central bank, in part because of her views on climate change and financial regulation.

Mr. Whitehouse welcomed Ms. Brainard’s nomination in his statement, saying: “It clearly recognizes the severity of the climate-related financial and economic risks our country is exposed to and will urge the Fed to make full use of its regulators in this area.”

Other groups critical of the Fed have expressed support for the picks, in particular Ms. Brainard.

The Fed-Up campaign, which advocates looser monetary policy and full employment, said the Fed must “continue employment-friendly, wage-oriented and racial macroeconomic policies as long as economic conditions permit.”

“Governor Brainard is a good choice for the vice chairman and we expect Biden to continue to make really bold and worker-friendly decisions for the vacant governorships,” the group said.

Legislators also expressed support for the move, though some Republicans have raised concerns about Ms. Brainard, who has pushed for tighter financial regulations.

Pennsylvania Senator Patrick J. Toomey, the senior member of the Senate Banking Committee, said he disagreed with some of Mr. Powell’s decisions during the crisis but would support his nomination.

“When the pandemic broke out in 2020, Chairman Powell acted quickly and took exceptional and necessary steps to help stabilize financial markets and the economy,” Toomey said in a statement.

The Senator expressed “concerns about the regulatory policies that Governor Brainard would support as Vice-Chair,” but said he looked forward to discussing these issues.

Both Mr. Powell and Ms. Brainard must win 60 votes to be approved by the Senate.