Senate Republicans threaten to delay vote on Fed nominees

The top Republican on the Senate Banking Committee said his party's members will boycott a vote by the panel scheduled for Tuesday afternoon on President Joe Biden's nominees to the Federal Reserve, potentially delaying confirmation for a second term for Chair Jerome Powell, who is serving in an acting capacity.

Democrats control the committee, but if no Republican attends the session, the votes on all five Fed nominees would be delayed.

Sen. Patrick Toomey of Pennsylvania, the senior Republican on the committee, said his fellow Republicans want more information about one of the nominees, Sarah Bloom Raskin, involving her role on the board of a company that won a coveted Fed clearance after she joined the firm. Toomey said committee Republicans are willing to vote on Biden's four other nominees.

“Important questions about Ms. Raskin’s use of the ‘revolving door’ remain unanswered largely because of her repeated disingenuousness,” Toomey asserted in a statement. “Her fitness to serve, her judgment, and her probity are of utmost importance because Ms. Raskin is being considered for a 10-year term at the nation’s independent central bank and foremost financial regulator.”

Sen. Sherrod Brown, the Ohio Democrat who chairs the committee, denounced Toomey's action, which Brown said could put the economy “at risk.”

“If my colleagues are as concerned about inflation as they claim to be, they will end the theatrics and show up today to do their jobs for the American people,” Brown said. "Any actions to delay this vote will hurt workers, their families and our recovery.”

The committee was scheduled to vote Tuesday on Powell, Raskin and Lael Brainard, a Fed board member whom Biden has nominated to the vice chair position. Votes on economists Lisa Cook, who would be the first Black woman to serve on the Fed's board, and Philip Jefferson, who would be the fourth Black man, were also scheduled.

Republicans have zeroed in on Raskin for her previous statements on the Fed and climate change, which Toomey and other GOP senators argue would lead her to use the Fed's tools to deny loans to oil and gas firms.

After serving previously as a Fed governor and as deputy secretary of the Treasury, Raskin joined the board of Reserve Trust, a fintech company that in 2016 applied for a “master account" at the Fed. Such an account would enable the company to transfer money using the Fed's payment systems without going through a bank. The company's application was turned down in mid-2017.

Yet the company reapplied and won approval the next year from the Federal Reserve Bank of Kansas City. Raskin had contacted the Kansas City Fed in 2017 after the company's application had been denied.

The Kansas City Fed, in a letter last week, said it had approved Reserve Trust's second application because the company changed its business model.