Democrats have moved to stall Donald Trump’s effort to exert greater control over the US Federal Reserve, condemning the president’s “absurd” bid to install a new leader of the central bank while it is targeted with criminal investigations.
Democratic lawmakers on the Senate banking committee urged its Republican leadership on Thursday to postpone the planned confirmation hearing for Kevin Warsh, the financial executive and former Fed governor Trump has nominated to replace Jerome Powell as Fed chair.
In a letter to banking committee chair Senator Tim Scott, a Republican from South Carolina, the 11 Democrats called for a hearing currently scheduled for Tuesday to be delayed until investigations into Powell and Lisa Cook, a current Fed governor, are closed.
Powell – whom the president has frequently and publicly chastised over his refusal to dramatically lower interest rates – is facing a criminal investigation into the renovations of the central bank’s headquarters, which he dismissed as a “pretext” tied to the Fed’s refusal to bow to Trump’s demands.
The Trump administration also tried to fire Cook, an appointee of Joe Biden, for alleged mortgage fraud. Cook has denied wrongdoing, and the president’s attempt to fire her has made its way to the US supreme court, where justices appeared skeptical of the case for terminating Cook.
The Democratic senators wrote in their letter to Scott: “It would be absurd on its face to allow President Trump to handpick the next chair of the Federal Reserve as his Department of Justice actively pursues criminal investigations of not one, but two sitting members of the Federal Reserve board. It would also be inappropriate to move forward with Mr Warsh’s nomination as the president publicly threatens the federal judge who found the DoJ’s probe to lack merit.”
Meanwhile, Trump has continued to rail against James Boasberg, the chief judge of the DC district court, who blocked the US justice department from seeking testimony from Powell over his remarks to Congress on the Fed’s renovation project.
Boasberg said in his 27-page ruling last month: “A mountain of evidence suggests that the government served these subpoenas on the board to pressure its chair into voting for lower interest rates or resigning.”
In response, Trump on Truth Social called Boasberg “wacky, nasty, crooked, and totally out of control”.
In a statement to the Guardian, the White House said that it was focused on working with the the Senate to “swiftly confirm” Warsh to lead the Fed. “[His] academic credentials, private sector success, and prior experience on the Fed Board of Governors make him eminently qualified to restore confidence and competence in Fed decision-making,” said Kush Desai, a spokesperson.
Elizabeth Warren, the banking committee’s top Democrat, told reporters that she still had “deep concerns” that Warsh, if confirmed, would be a “sock puppet” for the president.
Following a meeting with Warsh on Thursday, Warren also expressed concern that he appeared in the Epstein files, although he “claims to have zero knowledge of anything related to this”. Inclusion in the files does not imply wrongdoing.
In February, a trove of documents released by the justice department related to the late sex-offender included a list shared with Epstein titled “St. Barth’s Christmas 2010”, where Warsh and his wife, Jane Lauder, are named.
Warsh’s nomination also faces hurdles from within the president’s own party. The outgoing GOP senator Thom Tillis, a deciding vote on the banking committee, has said repeatedly he would not support any nomination as long as there is an investigation into Powell.
John Thune, the Republican Senate majority leader, even called on the justice to “wrap up” its inquiry into the Fed chair. “I think it’s in everybody’s best interest to wrap up the investigation,” he said.
Trump, however, went on a lengthy tangent during a Fox Business interview this week about the Fed’s renovations, alleging without evidence that it “is probably corrupt, but what it really is is incompetence”. He seemed unfazed by the possibility that Tillis could block Warsh’s confirmation.
