Democrats have denounced Trump’s election of Shelton, not only because of his unorthodox views, but also once suggested that federal deposit insurance for banks end, but also because their positions have apparently changed since he became running for the job, moving more in line with the president’s. vocal views on the Fed.
She has had a decades-long affinity for linking the value of the dollar to gold, but has been downplaying it ever since she was nominated. She closed low interest rates for years, but now supports Trump’s view that rates should be at zero. And it has abandoned its view that the central bank should not try to cater to the financial markets.
Shelton, an author with a doctorate in business administration, has also questioned the need for the central bank to operate without the influence of politicians, a design feature that aimed to encourage the Fed to act in the interest of the long-term economy. instead of increasing incumbents’ reelection prospects.
He later endorsed the independence of the Fed during his nomination hearing.
For some of these reasons, Shelton, at his confirmation hearing, faced tough questions from Republican Senators Pat Toomey of Pennsylvania, Richard Shelby of Alabama, and John Kennedy of Louisiana. All three were undecided after her performance, but today they voted for her.
Economists across the ideological spectrum have also voiced doubts about Shelton’s fitness for work.
If confirmed alongside fellow nominee Christopher Waller, who was approved on the committee by a vote of 18-7, he will be one of seven members of the Federal Reserve board, with a vote on interest rate policy and banking regulations.
Sen. Sherrod Brown (Democrat of Ohio) said he was voting against Waller, an economist at the St. Louis Fed, because he was “worried he won’t do the job of holding America’s largest banks and foreign accountable if he is confirmed”.
Democrats Jon Tester of Montana, Mark Warner of Virginia, Catherine Cortez Masto of Nevada, Doug Jones of Alabama and Kyrsten Sinema of Arizona voted for Waller.
If Trump lost reelection, Shelton and Waller’s confirmations would not leave empty seats in the Federal Reserve for the new president to occupy immediately. In the event that Trump wins, critics have raised fears that he may nominate Shelton as Fed chairman when Jerome Powell’s tenure as chief ends in 2022.
Trump has repeatedly criticized Powell on Twitter, including in personal terms, for not doing enough to boost the economy, but he has recently praised his performance during the pandemic-induced recession, during which the Federal Reserve has pledged to back the billions of dollars markets.
The seats on the Fed board are designed to change on a phased schedule, so Shelton’s term would end in January 2024, while Waller’s term would last until 2030.
