Trump Formally Names Kevin Warsh To Head Federal Reserve, but Nomination Faces Uncertain Future

President Trump, on Wednesday, formally nominated Kevin Warsh to become the next chairman of the Federal Reserve, but his confirmation remains in limbo due to an ongoing criminal investigation into the current chairman, Jerome Powell.Mr. Trump announced his pick of Mr. Warsh in January, but the nomination was not forwarded to the Senate until Wednesday. The Senate Banking Committee will be the first to take up the nomination. A Republican member of the committee, Senator Thom Tillis, has said he will block the confirmation of any Federal Reserve nominee until the Department of Justice resolves its inquiry into Mr. Powell “fully and transparently.”Mr. Powell — who was first nominated to lead the Fed by Mr. Trump and then renominated by President Biden — announced in January that he had been served grand jury subpoenas as part of a criminal investigation. The probe rests on allegations that there is some malfeasance in the over-budget renovations at the Federal Reserve’s headquarters and he lied to Congress about the extent of the issue.“I have deep respect for the rule of law and for accountability in our democracy. No one — certainly not the chair of the Federal Reserve — is above the law,” Mr. Powell said in a video revealing the investigation. “But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”Mr. Powell claims the threat of criminal charges is payback for the board rejecting the president’s demands to rapidly lower interest rates for political reasons.Mr. Tillis said that the investigation is “based on committee testimony that no reasonable person could construe as possessing criminal intent.” He previously said that he didn’t think it was a serious probe. “The majority of the Republicans have said that they were at the scene of the alleged crime and they saw no criminal activity,” Mr. Tillis told the Sun in February. “That should be a signal to a prosecutor that we were there. [They] haven’t interviewed me.”The banking committee is divided between 13 Republicans and 11 Democrats. If the investigation into Mr. Powell is not resolved by the time Mr. Warsh has his confirmation hearing, Mr. Tillis’s “no” vote would almost certainly leave the committee deadlocked at 12–12 with all Democrats voting against the nomination. Such a situation means that a nominee is not reported favorably to the full Senate.Mr. Trump has been highly critical of the Federal Reserve and Mr. Powell. He previously threatened to fire Mr. Powell but backed off of that threat. He did fire another Fed governor, Lisa Cook. Two lower courts have ruled Ms. Cook can stay in her role as she fights her firing. The Supreme Court has heard that case but has not released a decision yet on whether her firing is legal.Mr. Powell’s term as chairman ends on May 15, giving the process less than 10 weeks to play out.

Trump Formally Names Kevin Warsh To Head Federal Reserve, but Nomination Faces Uncertain Future

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