Senator Joe Manchin III, a key centrist Democrat, announced on Monday that he would not support Sarah Bloom Raskin for a top position on the Federal Reserve, potentially dooming her chances for confirmation as Republicans show little appetite for placing a supporter of stricter bank regulation into the powerful role.
Without Republican support in the evenly divided Senate, Democrats need all 50 senators who caucus with their party to vote in favor of Ms. Raskin for her to become the Federal Reserveâ€™s vice chair for supervision. Republicans have so far stonewalled her nomination in committee, raising concerns about her position on climate regulation and her work in the private sector.
Mr. Manchin, a West Virginian who has close ties to the fossil fuel industry and has rejected much of President Bidenâ€™s climate agenda, cited her statements on climate and energy policy, and pointedly noted that the board â€œis not an institution that should politicize its critical decisions.â€
â€œHer previous public statements have failed to satisfactorily address my concerns about the critical importance of financing an all-of-the-above energy policy to meet our nationâ€™s critical energy needs,â€ Mr. Manchin said in a statement. â€œI have come to the conclusion that I am unable to support her nomination to serve as a member of the Federal Reserve Board.â€
He added that â€œthe Federal Reserve Board must remain hyper-focused on ending the inflation taxes hurting working families and getting more workers off the sidelines and back into the economy.â€
Without his support, Ms. Raskin, a former Fed governor and Obama administration official, is unlikely to secure the votes needed to clear the Senate unless a Republican breaks ranks and votes to back her.
â€œManchinâ€™s decision is very likely to doom Raskinâ€™s nomination,â€ Ian Katz, managing director at Capital Alpha Partners, wrote in reaction to the news. â€œWe wouldnâ€™t be surprised if Raskin withdraws in the next week or two â€” perhaps sooner.â€
The White House vowed on Monday to press ahead with her nomination, with a spokesman emphasizing Ms. Raskinâ€™s qualifications and outside support.
â€œShe has earned widespread support in the face of an unprecedented, baseless campaign led by oil and gas companies that sought to tarnish her distinguished career,â€ said Chris Meagher, a spokesman for the White House. â€œWe are working to line up the bipartisan support that she deserves, so that she can be confirmed by the Senate for this important position.â€
Lawmakers on the Senate Banking Committee have been at loggerheads over Ms. Raskinâ€™s nomination. Republicans have boycotted a hearing that would let committee Democrats advance an entire slate of key banking nominations, including the renomination of Jerome H. Powell, the Fed chair, over objections to Ms. Raskinâ€™s selection.
Senator Patrick J. Toomey of Pennsylvania, the top Republican on the committee, emphasized his opposition to Ms. Raskin and her past comments on climate regulation in a statement on Monday.
â€œAs weâ€™ve repeatedly said, Republican members of the Banking Committee are willing to vote on the other four Fed nominees,â€ Mr. Toomey said. Referring to Senator Sherrod Brown, Democrat of Ohio and the committeeâ€™s chair, he added, â€œI hope Chairman Brown will immediately move forward with scheduling a vote for this week.â€
Republicans had specifically cited concerns about Ms. Raskinâ€™s time on the board of directors of a financial technology firm. The company, Reserve Trust, secured a coveted account with the Fed â€” giving it access to services that it now prominently advertises â€” after Ms. Raskin reportedly called a central bank official to intervene on its behalf.
It is unclear how much Ms. Raskinâ€™s involvement mattered in helping Reserve Trust secure the Fed account. But the episode has raised questions, because she previously worked at the Fed and because she made about $1.5 million from the stock she was given for her Reserve Trust work. Her own party regularly blasts the revolving door between regulators and financial firms.
Republicans have demanded that Ms. Raskin provide more answers about what happened while she was on the companyâ€™s board, but she has largely said she cannot remember what happened, drawing lawmaker criticism. Mr. Toomey led his Republican colleagues in refusing to show up to vote on Ms. Raskin and the other Fed nominees until she provides more answers.
If she cannot secure all the Democratic votes, though, the issue is likely moot.
â€œNow that itâ€™s clear Sarah Bloom Raskin has no path to confirmation, itâ€™s time for the Senate Banking Committee to proceed with the other four nominees, as committee Republicans have been pushing for weeks,â€ Senator Thom Tillis, Republican from North Carolina, wrote Monday on Twitter.
Besides Mr. Powell, who goes by Jay, Mr. Biden has nominated Lael Brainard to be the Fedâ€™s vice chair and two academic economists â€” Philip Jefferson and Lisa Cook â€” to be governors.
â€œThis effectively kills her nomination,â€ Tobin Marcus at Evercore ISI wrote after the news, adding that it â€œlikely clears the way for Bidenâ€™s other Fed nominees â€” Jay Powell, Lael Brainard, Lisa Cook and Philip Jefferson â€” to advance and be confirmed.â€