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Tester, Daines at odds over Biden Federal Reserve pick amid GOP boycott

Sens. Steve Daines, right, sits next to Sen. Jon Tester at an event in Missoula. (Martin Kidston/Missoula Current file photo)

Republican members of the U.S. Senate Banking Committee including Montana Sen. Steve Daines boycotted a confirmation vote for President Joe Biden’s five picks to the Federal Reserve on Tuesday, citing unanswered questions about the nominee for vice chair for supervision, Sarah Bloom Raskin.

Both Daines and Democratic Montana Sen. Jon Tester sit on the committee, chaired by Sen. Sherrod Brown, D-Ohio. The panel was set to take a vote on the five nominees, including incumbent Federal Reserve Chair Jerome Powell, a Trump appointee, Tuesday afternoon, but Brown was forced to delay the decision due to the absence of the committee’s 12 Republicans — exactly half of its members.

Tester had previously said he was taking a closer look at Bloom Raskin’s record. Tuesday, however, he expressed support along with the committee’s other Democrats for all five nominees: Powell, Bloom Raskin, Lael Brainard, Lisa Cook and Philip Jefferson.

“Our constituents sent us here to vote, and nobody’s on the other side,” Tester said in committee Tuesday. “I hear on the floor every day Republicans get up and talk about inflation — and by the way, inflation is very important, and we need to get our arms around it. But what group is out there to deal with market forces better than the Fed?”

A spokesperson for Daines did not answer questions about the boycott in time for publication. But his office told KULR in Billings he had “unanswered questions” regarding allegations from the committee’s top Republican, Sen. Pat Toomey of Pennsylvania, that Bloom Raskin in 2017 improperly lobbied the head of the Kansas City Fed on behalf of a finance company on whose board she sat.

Toomey and other Republicans have accused Raskin, who had served on the Fed’s board of governors in the past, of using her connections to gain access to a so-called “master account” with the Fed for a Colorado finance-tech company she was involved with. They’ve taken issue with the fact that she made a phone call to the Kansas City Fed after it initially denied an application from the firm for a master account, which allows an institution access to central bank money. The Fed later approved the application.

Both Raskin and the Kansas City Fed have defended the sequence of events as proper, with the Fed saying it “did not deviate from its review process in evaluating this request.”

Republicans have also attacked Bloom Raskin for her beliefs that financial regulators should address climate change, though she’s clarified to the committee that she doesn’t believe the Fed should be picking winners and losers in the private sector. Democrats and environmental advocates have called for the nation’s top bank regulator to be more proactive in evaluating how the existential risks posed by climate change feed into risk in the financial sector.

GOP opposition to Bloom Raskin has effectively gummed up the nominations for Powell and Biden’s other picks, who have more support from Republicans.

“Chairman Powell has been a steady hand guiding our economy through one of the greatest economic crises in American history, and he has received bipartisan support for his decisive efforts,” Tester said. “But at a pivotal moment for our recovery, Mitch McConnell and his followers are blocking Powell’s confirmation and kneecapping the Fed’s ability to combat inflation and lower costs for working families.”

A spokesperson for Tester said last month that the Senator “believes we need to do more to address the very real dangers of climate change and the threat they pose to Montana’s economy,” but also that “the Fed should not be picking winners and losers when it comes to the energy sector.”