Sen. Tillis will oppose Trump Fed chair pick Warsh until Powell probe resolved

by · CNBC

Key Points

  • Sen. Thom Tillis said he will oppose President Donald Trump's nomination of Kevin Warsh as the next chair of the Federal Reserve until the federal criminal probe of current Chair Jerome Powell is resolved.
  • The North Carolina Republican's stance makes it likely that Warsh's nomination will not be recommended for approval by the Senate Banking Committee.
  • "No Republican purporting to care about Fed independence should agree to move forward with this nomination," said Sen. Elizabeth Warren, a Massachusetts Democrat.

Sen. Thom Tillis said Friday that he will oppose President Donald Trump's nomination of Kevin Warsh as Federal Reserve chair until the criminal probe of the current chair, Jerome Powell, is "fully" resolved.

"Protecting the independence of the Federal Reserve from political interference or legal intimidation is non-negotiable," the North Carolina Republican said in a statement on X.

Tillis, who is set to retire, vowed earlier this month to oppose any new nominee for the Fed until the Department of Justice's controversial investigation of Powell is completed.

Tillis is a member of the Senate Banking, Housing, and Urban Affairs Committee, which has 13 Republicans and 11 Democrats.

The refusal of a single Republican on that panel to vote for a presidential nominee would set up a stalemate that could leave Warsh's nomination without a recommendation of approval by the full Senate.

Powell has said he is under investigation by the DOJ, ostensibly in connection with the Fed's multibillion-dollar renovation of its headquarters and his testimony to Congress about that project.

Powell says the real reason for the probe is his and other Fed board members' refusal to cut interest rates as quickly and as much as Trump has demanded.

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"Kevin Warsh is a qualified nominee with a deep understanding of monetary policy," Tillis said in his statement.

"However, the Department of Justice continues to pursue a criminal investigation into Chairman Jerome Powell based on committee testimony that no reasonable person could construe as possessing criminal intent," Tillis said.

"My position has not changed: I will oppose the confirmation of any Federal Reserve nominee, including for the position of Chairman, until the DOJ's inquiry into Chairman Powell is fully and transparently resolved."

Sen. Elizabeth Warren of Massachusetts, the ranking Democrat on the banking committee, in a statement on Friday, said, "No Republican purporting to care about Fed independence should agree to move forward with this nomination" of Warsh.

"Donald Trump said anybody who disagrees with him will never be Fed Chairman," Warren said.

"Former Fed Governor Kevin Warsh – who cared more about helping Wall Street after the 2008 crash than millions of unemployed Americans – has apparently passed the loyalty test," she said.

"This nomination is the latest step in Trump's attempt to seize control of the Fed and follows the Trump Administration's weaponization of the Department of Justice to open criminal investigations into Fed Governor Lisa Cook and sitting Fed Chair Jerome Powell."