February 13, 2020, Judy Shelton testifies before the Senate
Banking, Housing and Urban Affairs Committee during a hearing on
their nomination to be member-designate on the Federal Reserve
Board of Governors in Washington, DC. Sarah Silbiger / GETTY
IMAGES NORTH AMERICA / AFP
The US Senate on Tuesday blocked President Donald
Trump’s controversial pick from joining the Federal Reserve board,
at least for now.
Two Republicans joined Democrats in opposing Judy Shelton, a
strident critic of the central bank who has faced an unprecedented
public wave of resistance from dozens of well-known economists and
Nobel laureates.
Vice President-elect and Senator Kamala Harris returned to
Washington to cast the tie-breaking vote, interrupting planning for
President-elect Joe Biden’s administration.
However, Senate Republican leader Mitch McConnell also voted no
making the final tally 50-47, likely a strategic move which leaves
the door open for him to call for another vote.
Covid-19 complicated the voting, as two Republican senators were
unable to vote because they were in quarantine, including Chuck
Grassley of Iowa — who missed a vote for the first time since
1993.
A third Republican who was absent publicly opposed Shelton’s
nomination.
Shelton was an outspoken supporter of low-interest rates when
President Barack Obama was in office.
Her nomination was one of several Trump made that would have
undermined the political independence of the US central bank.
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“We need a reliable Federal Reserve to help manage our economy
in this pandemic. Judy Shelton’s dangerous ideas would devastate
our economy, and her lack of commitment to using the full force of
the Fed to provide COVID-19 relief is unacceptable,” Harris said on
Twitter after the vote.
Harris delivers remarks in Wilmington, Delaware, on November 7,
2020, after being declared the winners of the presidential
election. (Photo by Andrew Harnik / POOL / AFP)
Shelton also has expressed support for returning to the gold
standard — where the currency is tied to a fixed quantity of gold —
believing that such a system would guarantee stability for exchange
rates.
However, a return to the gold standard is viewed as unrealistic
and outdated by the majority of economists — it was abandoned in
1971 by President Richard Nixon.
Fed nominations are always bipartisan, but Senator Chuck
Schumer, the top Democrat in the upper chamber, lambasted Shelton
as supremely unfit for the position.
She is “without a doubt one of the most unqualified nominees I
have ever seen for our nation’s central bank,” he said on the
Senate floor, criticizing her as an “economic weather vane pointing
whichever way she thinks the partisan winds are blowing.”
AFP
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