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For Immediate Release

Press Release

Revolving Door Project Criticizes Biden For Choosing To Own Ethics Scandals And Deregulation By Renominating Powell

WASHINGTON -

“We are extremely disappointed to see Biden renominate Jerome Powell as Chair of the Federal Reserve Board. Biden’s endorsement of Powell’s deregulatory agenda will greatly harm American families. Biden has an ambitious and urgent agenda on climate, financial stability, and addressing racial and economic inequality. Powell as Chair of the Federal Reserve will make it more difficult for Biden to ultimately be a successful president. Today is a win for the conventional wisdom and Establishment and a defeat for the planet and Joe Biden’s ultimate legacy."

"To be clear, this choice means the president now owns what is — and what will be — known about Powell’s own trading scandal and his tightlipped, insufficient response to the whole slate of Federal Reserve scandals. This does not make these breaches of public trust acceptable, and does not signal an end to the egregious actions from Powell himself or other members of the national or regional branches of the Fed.”

“It is somewhat encouraging that Biden nominated Lael Brainard to be the Fed’s Vice Chair. However, as we previously noted, the Vice Chair is little more than a ceremonial title if the Chair disagrees with her preferences on monetary or regulatory policy. The Chair allocates precious staff resources and determines what proposals even reach a vote before the Board. Biden failed when he legitimized a Republican private equity executive who refuses to regulate or act on the climate emergency at the helm of the Fed.”

“And while we remain sadly cognizant of how powerful the Chair is at the Federal Reserve, we do urge the Administration to minimize Trump’s deregulatory Federal Reserve legacy and make a regulatory expert like Sarah Bloom Raskin Vice Chair for Supervision. The bitterness of this decision for progressives could be mitigated some by the ascent of a rising star such as Dr. Lisa Cook to the Board of Governors.”

“The Revolving Door Project will continue to closely follow Powell’s actions as Chair. Research into his ethical conflicts, and those of other Fed members, will be ongoing, as will detailed tracking of regulatory actions (or lack thereof.) We suspect the Powell confirmation fight will be brutal, and details not yet public concerning the Federal Reserve’s ethical scandal will figure prominently. In the meantime, Senate Democrats must demand two things from Powell: That he step entirely away from the ethics investigation into his own wrongdoing and that he commit to acceding to all supervision-related resource and agenda requests from the Vice Chair for Supervision.”

 

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The Revolving Door Project (RDP), a project of the Center for Economic and Policy Research (CEPR), scrutinizes executive branch appointees to ensure they use their office to serve the broad public interest, rather than to entrench corporate power or seek personal advancement.

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