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Biden Nominee Sarah Bloom Raskin Withdraws Her Candidacy for Federal Reserve Board

Ken Cedeno | Reuters
  • Sarah Bloom Raskin, President Joe Biden's embattled nominee to the Federal Reserve, withdrew her candidacy to serve at the central bank.
  • Raskin's withdrawal ends a weekslong partisan battle in the Senate over her views on climate policy.
  • The move came a day after Sen. Joe Manchin, a conservative Democrat from West Virginia, said he could not support her nomination.
  • Biden had picked Raskin — a former Fed governor and deputy Treasury secretary — to be the Fed's next vice chair for supervision, one of the world's most powerful banking regulators.

Sarah Bloom Raskin, President Joe Biden's embattled nominee to the Federal Reserve, on Tuesday withdrew her candidacy to serve at the central bank, ending a weekslong partisan battle in the Senate over her views on climate policy.

Raskin's withdrawal comes a day after Sen. Joe Manchin, a conservative Democrat from West Virginia, said he could not support the 60-year-old's nomination to be the Federal Reserve's vice chair for supervision, one of the world's most powerful banking regulators.

Manchin's decision would have made her confirmation nearly impossible in a Senate split 50-50 between Democrats and Republicans.

Biden in a statement praised Raskin while blasting her opponents.

"Despite her readiness — and despite having been confirmed by the Senate with broad, bipartisan support twice in the past — Sarah was subject to baseless attacks from industry and conservative interest groups," Biden said.

"Unfortunately, Senate Republicans are more focused on amplifying these false claims and protecting special interests than taking important steps toward addressing inflation and lowering costs for the American people," the president said.

Raskin, who previously served as a Fed governor and deputy Treasury secretary, echoed that statement in a letter to Biden, in which she blamed "relentless attacks by special interests" in derailing her nomination.

She wrote that she fears that "many in and outside the Senate are unwilling to acknowledge the economic complications of climate change and the toll it has placed and will continue to place, on Americans," according to the letter, which was published in full by The New Yorker magazine.

"It was — and is — my considered view that the perils of climate change must be added to the list of serious risks that the Federal Reserve considers as it works to ensure the stability and resiliency of our economy and financial system," wrote Raskin, who is married to Rep. Jamie Raskin, D-Md.

The end of her candidacy comes as the Biden administration and the Fed are dealing with the highest rate of inflation seen in four decades. A key Fed mandate is to control the inflation rate, often through the use of adjustments in interest rates.

Raskin's nomination ran into trouble in early February when Senate Republicans made it clear they opposed her prior remarks critical of the U.S. fossil fuel industry and her research into bank lending away from major oil, gas and coal producers.

Republicans also had made an issue of Raskin's prior stint as a member of the board of the financial tech company Reserve Trust, which she joined after leaving her post as a deputy Treasury Department secretary.

Reserve Trust obtained a coveted master account at the Federal Reserve after Raskin personally intervened in the issue when the company was initially denied that status.

The GOP opposition blossomed into a full-scale boycott of all of the president's Fed nominees when Democrats insisted the Biden administration's candidates all be approved at the same hearing. Republicans, led by Sen. Pat Toomey of Pennsylvania, effectively denied Democrats the necessary quorum required to hold a legitimate vote.

Had any Republican agreed to attend a vote, even if they had voted against Raskin, their mere presence would have allowed all five nominees to advance out of the Banking Committee.

"Republicans engaged in a disingenuous smear campaign, distorting Ms. Raskin's views beyond recognition and made unsubstantiated attacks on her character," said Senate Banking Committee Chairman Sherrod Brown, D-Ohio.

"Committee Democrats were united, and we did our jobs," said Brown.

But, in the end, opposition from within Biden's own party doomed Raskin's nomination.

Manchin, in a statement Monday opposing Raskin had said, "Her previous public statements have failed to satisfactorily address my concerns about the critical importance of financing an all-of-the-above energy policy to meet our nation's critical energy needs."

His statement suggested he lacked faith that Raskin could serve on the central bank without politicizing her decisions based on her prior climate remarks.

Manchin receives regular donations from executives in the energy industry, including support from CEOs Ryan Lance of ConocoPhillips and Vicki Hollub of Occidental Petroleum.

Brown in his statement said, "Unfortunately, too many of my colleagues ignored the broad, bipartisan support from community bankers, top economists, cybersecurity experts, state banking regulators, consumer advocates, and so many others."

"Instead, they fell for talking points written by the oil and gas industry," Brown said.

Biden on Tuesday urged the Senate to "confirm the four eminently qualified nominees for the Board of Governors—Jerome Powell, Lael Brainard, Philip Jefferson, and Lisa Cook—who are still waiting for an up-or-down vote."

"This group has the experience, judgment, and talent necessary to lead the Federal Reserve at this critical moment in our economic recovery, and the Senate should move their nominations forward," Biden said.

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