At Hearing, Warren Delivers Remarks on Kevin Warsh’s Nomination for Fed Chair

At Hearing, Warren Delivers Remarks on Kevin Warsh's Nomination for Fed Chair

Watch opening statement here (YouTube)

Washington, D.C. - Today, U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, delivered opening remarks at the nomination hearing of Kevin Warsh, President Trump's nominee for Chair of the Federal Reserve.

Below is Ranking Member Warren's opening statement as delivered:

We should not be having this hearing today. And, here's the context.

First: Over the past year, President Trump has racked up one economic failure after another-and Americans know that. Consumer sentiment just hit its lowest level on record-ever. Inflation is rising, and families are paying more for groceries, more for health care, more for utilities, more for housing, all thanks to Trump's chaotic tariffs and One Big Beautiful Bill. And now, his war with Iran is putting American troops in harm's way and further driving up the cost of nearly everything here at home.

Second: In your testimony, you said it's perfectly fine for elected officials to state their views on interest rates. But that is not what Donald Trump is doing. The President has repeatedly and illegally attempted to take over the Fed. His bogus attacks on Governor Lisa Cook and Chair Powell were designed to threaten all the members of the Fed to do Trump's bidding and open more spots for Trump flunkies. Why try to end the independence of the Fed? Because Trump's economic failures are causing him political problems, and he wants the Fed to use monetary policies to artificially juice the economy in the short term - and this is his last chance to do that before the November elections.

Having a sock puppet in charge of the Fed would also give the President access to the Fed's powerful authorities to enrich himself, his family, and his Wall Street buddies. It could mean granting special accounts to his family's crypto company or bailouts to his friends on Wall Street if they get into trouble. In other words, a Fed under Trump's control creates more opportunities for Trump's corruption.

Third: the nominee before us today, Kevin Warsh, is uniquely ill-suited for the job as Fed Chair. In our meeting last week, we discussed the 2008 financial crash, where eight million people lost their jobs, 10 million people lost their homes, and millions more lost their life savings. Giant banks, however, got hundreds of billions of dollars in bailouts. Mr. Warsh was a Fed governor from 2006 to 2011-that's before, during and after the crash. And he said to me that he has "no regrets" about anything he did.

So, let's take a deeper dive into Mr. Warsh's record. In the years leading up to the 2008 financial crisis he was an enthusiastic cheerleader for credit default swaps and complex securitizations. He dismissed repeated and increasingly urgent concerns from housing advocates across the country regarding subprime mortgages. He refused to use the Fed's authorities to address the risks that were building in the financial system.

When the crisis hit and the economy blew up, Warsh took on the job of Wall Street's personal liaison on the Fed Board. He was quick to respond to concerns from Wall Street CEOs and he worked tirelessly to arrange multibillion-dollar bailouts for them-with nothing for American families. No regrets, he says, no regrets.

After the crash, most people on the Fed saw millions of Americans unemployed, people who lost their homes and said - now might be a good time to lower rates and make the cost of borrowing cheaper for businesses to avoid more layoffs and make it cheaper for Americans worried about paying their mortgages or credit cards.

But not Mr. Warsh. Nope. He wanted to keep interest rates high. And he sang that same song for more than a decade, even as the economy struggled. When the job of Fed Chair became available during Trump's first term as President, Warsh held on to his high-interest-rate, inflation-hawk views, and Trump passed him by. Regretful, he soon reversed course and called for the Fed to pause interest-rate hikes. Then, once Trump left office, Mr.Warsh flipped again, and was even criticizing the Fed for cutting rates in the fall of 2024. But as soon as Donald Trump became President a second time, Warsh reversed himself once more and began shouting from the rooftops about how the Fed should cut interest rates. Evidently he learned his lesson. This time around he sucked up to Trump to snag his dream job.

Mr. Chairman, last week every single Democratic member of this Committee asked that you postpone this hearing and instead conduct oversight on the President's role in directing bogus criminal probes into Chair Powell and Governor Cook. The Senate should not be aiding and abetting Donald Trump's illegal takeover of the Fed by installing his chosen sock puppet as Chair. It's an invitation for corruption and economic catastrophe. We have the power to stop it, and we should be using that power.

Thank you Mr. Chairman.

##

• Print
• Email
• Tweet