Biden's Fed nominee Raskin opposed by 24 state financial officers over 'radical' economic views
Raskin's stance on climate change has emerged as major point of contention
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A coalition of Republican state financial officers is pushing back again Sarah Bloom Raskin, President Biden’s nominee to become the Federal Reserve's top Wall Street regulator, over concerns that her economic views on issues like climate change and the private banking sector are "radical."
In a Monday letter addressed to the White House, 24 state treasurers, auditors and financial officers urged Biden to withdraw his nomination of Raskin as the Fed's vice chair of supervision, warning that her past statements indicate she is "willing to place the growth and stability of the U.S. economy at risk to achieve her preferred social outcomes."
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A major point of contention for the state financial officers is Raskin's stance on climate change and her view that it poses a systemic risk to the U.S. financial system. Raskin has previously argued that all financial institutions should re-evaluate their relationships with energy companies and has advocated for a push toward sustainable investments that do not depend on carbon and fossil fuels. If banks and other financial institutions do not take these steps to distance themselves from fossil-fuel companies, Raskin has said the Fed should penalize them.
Sarah Bloom Raskin, governor of the U.S. Federal Reserve, on Tuesday, Dec. 10, 2013. (Andrew Harrer/Bloomberg via Getty Images / Getty Images)
"We oppose Ms. Raskin’s radical banking and economic views and are deeply concerned that she would use the supervisory authority as Vice-Chair for Supervision at the Federal Reserve Bank to disrupt the private banking sector, reliable energy supplies, and the U.S. economy," the state financial officers wrote.
Signatories included the financial officers from Nebraska, Arkansas, Missouri, Utah, Louisiana, Arizona, Florida, Georgia, Idaho, Indiana, Kentucky, Mississippi, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, West Virginia and Wyoming.
The letter comes just a few days before Raskin is scheduled to testify before the Senate Banking Committee on Thursday, along with two other academic economists that Biden tapped to join the central bank's board of governors: Lisa Cook and Philip Jefferson. The nominees need to be approved by a simple majority vote in the Senate.
As vice chair for supervision, Raskin – a Duke University law professor who has held high-level jobs at both the Treasury Department and the Fed – would oversee annual stress tests that review bank safety and liquidity. Her nomination has been welcomed by progressive senators and advocacy groups, who think she will take a tougher stance against Wall Street than her predecessor, Randal Quarles, a Trump nominee who stepped down last month.
But Republicans are already gearing up to fight Raskin's nomination as the Fed's top regulatory czar: A senior GOP aide told FOX Business that the party has "serious concerns" about her push to develop financial regulatory policies for cryptocurrencies and fighting climate change. Raskin's husband, Rep. Jamie Raskin, D-Md., also led the second impeachment trial of former President Trump.
A man wearing a mask walks past the U.S. Federal Reserve building in Washington D.C., on April 29, 2020. (Xinhua/Liu Jie via Getty Images / Getty Images)
Raskin previously served on the Fed's board from 2010 to 2014 and was tapped by former President Obama to serve as assistant Treasury secretary.
Sen. Pat Toomey, the ranking member of the Senate Banking Committee, is expected to press Raskin over her view that federal policymakers take "bold actions" in order to avoid an "economic catastrophe" brought on by climate change. He also plans to question her calls for the Fed to allocate credit to businesses and deny credit to disfavored ones, such as oil and gas companies.
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"I have serious concerns that she would abuse the Fed’s narrow statutory mandates on monetary policy and banking supervision to have the central bank actively engaged in capital allocation. Such actions not only threaten both the Fed’s independence and effectiveness, but would also weaken economic growth," Toomey, R-Pa., said in a statement.
Late last year, Biden nominated Chairman Jerome Powell to a second four-year term at the helm of the central bank, and picked current Fed Governor Lael Brainard as the Fed's second-in-command.
The White House has defended the nomination, with press secretary Jen Psaki telling FOX Business' Edward Lawrence on Monday that Raskin brings "unprecedented experience and the support of economic experts across the spectrum" to this role.
"She believes, and she has said she believes firmly in the independent role of the Federal Reserve and will work in concert with her colleagues to identify and mitigate a range of risks," Psaki said.