A group of progressive House Democrats, including Rep. Alexandria Ocasio-Cortez of New York, on Monday called for President Joe Biden to replace Fed Chairman Jerome Powell when his term expires in February.
In a joint statement first reported by Politico, the lawmakers urged Biden “to re-imagine a Federal Reserve focused on eliminating climate risk and advancing racial and economic justice.”
Reps. Rashida Tlaib, D-Mich.; Ayanna Pressley, D-Mass.; Mondaire Jones, D-N.Y.; and Chuy Garcia, D-Ill., joined Ocasio-Cortez in calling for a change. All five lawmakers serve on the House Financial Services Committee.
While acknowledging “positive changes” under Powell on efforts to reach full employment, the legislators said: “To move forward with a whole-of-government approach that eliminates climate risk while making our financial system safer, we need a chair who is committed to these objectives. We urge the Biden administration to use this opportunity to appoint a new Federal Reserve chair.”
“Under his leadership, the Federal Reserve has taken very little action to mitigate the risk climate change poses to our financial system,” they said of Powell. “At a time when the Intergovernmental Panel on Climate Change is warning of the potential catastrophic and irreversible damage inflicted by a changing climate, we need a leader at the helm that will take bold and decisive action to eliminate climate risk.”
The Democrats also decried moves by the Fed, under Powell, to reduce banking regulations put into place after the financial crisis. “Weakening financial regulations that were specifically created to prevent such a disaster from happening again risks the livelihoods of Americans across the country,” they said.
Powell is seen as having broad support from the White House and is expected to be nominated for another term. But a growing number of more liberal Democrats, including Sen. Elizabeth Warren, D-Mass., and Sen. Sherrod Brown, D-Ohio, have publicly criticized Powell recently.
Biden is expected to make a decision about Powell’s future this fall. The leading contender to replace him, if it comes to that, appears to be Fed governor Lael Brainard, the Wall Street Journal reported earlier this month.