Senate Republicans boycott vote on Federal Reserve nominees

By Alex Rogers, Manu Raju and Ted Barrett, CNN

Senate Republicans boycotted a vote Tuesday afternoon in protest of President Joe Biden’s nomination of Sarah Bloom Raskin to be the top banking regulator, halting a slate of pending nominees for the central bank of the United States.

While Republicans support other nominees — including Jay Powell to continue serving as Federal Reserve chairman — they are opposed to Raskin’s nomination as the Fed’s vice chair for supervision since she previously called for the Fed to crack down on bank lending to fossil fuel companies.

Raskin, who served as a deputy treasury secretary and a governor of the Federal Reserve Board in the Obama administration, has since said she would not use her position to restrict lending to the oil-and-gas industry, emphasizing in February, “Banks choose their borrowers, not the Fed.”

But Republicans have also raised questions about how Reserve Trust, a Colorado financial technology firm, received access to the Fed’s payments system while Raskin served on the firm’s board.

“Committee Republicans aren’t seeking to delay her vote. We’re seeking answers,” said Pennsylvania Sen. Pat Toomey, the top Republican on the Banking Committee, in a statement. “Until basic questions have been adequately addressed, I do not think the Committee should proceed with a vote on Ms. Raskin.”

Republican Sen. Kevin Cramer of North Dakota said Raskin’s rhetoric is “radical” and that she has “ethical problems” that have “yet to be completely looked into.”

“Her nomination is becoming a tremendous problem, I think, for the Biden administration,” Cramer added. “I would hope that he would pull her and then let us move forward with the others.”

Democrats blasted Republicans on the Senate Banking Committee for skipping the vote on Tuesday and scuttling Biden’s picks for the Fed.

Before the planned votes, Democratic Sen. Sherrod Brown of Ohio, the Banking Committee chairman, said that he would proceed with voting on the nominations, saying he was “hopeful that at least one” of the dozen Republicans on the committee “decides to do his job.”

“If Republicans are as concerned as they say about combating inflation, they should want a full Federal Reserve Board in place,” he added.

During the hearing, Senate Democrats castigated Republicans for not showing up, noting that they could still have registered their opposition by voting against Raskin. Brown said that she “has been the subject of an unrelenting smear campaign and fearmongering” by Toomey and other Senate Republicans. He said that he would delay the votes on the Fed nominees.

“I’m certainly not ruling out doing another vote,” Brown said.

White House press secretary Jen Psaki said that Raskin is “one of the most qualified individuals to ever be nominated to the Federal Reserve and has made the strongest ethics commitments in the history of the Fed.”

“Even after she’s made extensive disclosures to the Banking Committee, Senator Toomey has continued to promote false allegations that have already been shot down by ethics experts, the Kansas City Fed, the founder of Reserve Trust, Sarah Bloom Raskin herself, and more,” Psaki added.

But Democrats have little recourse if they don’t reach an agreement with the committee’s Republicans because of the unique rules of the 50-50 Senate and its power-sharing agreement.

Democrats must either overcome a 60-vote threshold in the full Senate, requiring 10 GOP votes to bring the nomination to the floor, or change the Senate rules on a party-line vote, known as the nuclear option.

West Virginia Democratic Sen. Joe Manchin, however, opposes changing the chamber’s rules that way.

“Rule change is by two-thirds, 67,” he said Tuesday, adding that a bipartisan group of senators is looking at some rules changes to help ease logjams in the Senate. He added he had to review the matter before the Senate Banking Committee before weighing in further.

This story has been updated with additional developments Tuesday.

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CNN’s Matthew Egan and Morgan Rimmer contributed to this report.