Sen. Elizabeth Warren on Tuesday vowed to oppose the renomination of Federal Reserve Chairman Jerome Powell — accusing him of being a “dangerous man” who has made the US banking system less safe during his tenure.
“Your record gives me grave concerns. Over and over, you have acted to make our banking system less safe, and that makes you a dangerous man to head up the Fed, and it’s why I will oppose your renomination,” the Democrat from Massachusetts said during a hearing before the Senate banking committee.
Warren argued that under Powell, the Fed has weakened oversight of banks, including by adjusting bank stress tests, the Volcker Rule and banks’ liquidity requirements.
Powell — a Republican appointed by former President Donald Trump — disagreed with Warren’s characterization of those moves as deregulatory, but added that it’s “fair game” to examine the Fed’s actions under his leadership.
He did not respond to Warren’s comment that she will oppose his renomination.
However, Powell’s pandemic-response efforts and his focus on jobs has won praise from Biden administration officials and policy analysts in the broader Democratic community.
A variety of powerful Democrats, including Sens. Dick Durbin, Jack Reed and Richard Blumenthal, have all hailed Powell’s response to the pandemic, though Reed and Durbin stopped short of committing to renominate him.
Under Powell, the S&P 500 has also surged about 60 percent, in line with the index’s gain during Yellen’s four years in charge of the Fed, when Wall Street extended its recovery from the 2008 financial crisis into a nearly decade-long bull market.
Powell has served since 2018 and his term expires in February. President Joe Biden has not yet committed to renominating him as Fed Chair.
The president can nominate a Fed chair from among the sitting governors for four-year terms. The Senate must then confirm the nominee.
Powell was confirmed by a comfortable margin for his current term, with 84 senators in favor.
Some other far-left politicians, including Reps. Ayanna Pressley and Alexandria Ocasio-Cortez, have also voiced opposition to his renewed tenure but Warren is now the highest-ranking politician to do so.
Warren went on to say that Powell’s deregulatory efforts could lead to another calamity like the one seen in the wake of the 2008 collapse of the housing market.
She claimed Powell is “lucky” that banks have been able to avoid major problems, despite serious incidents like the implosion of Archegos Capital Management.
“So far you’ve been lucky. But the 2008 crash shows what happens when the luck runs out,” she said. “The seeds of the 2008 crash were planted years in advance by major regulators like the Federal Reserve that refused to rein in big banks. I came to Washington after the 2008 crash to make sure nothing like that would ever happen again.”