Progressive Democratic lawmakers urge Biden to replace Powell as Fed Chair

Reps. Alexandria Ocasio-CortezAlexandria Ocasio-CortezEviction ruling puts new pressure on Congress On The Money: Progressives dig in for fall fight with centrists on Biden budget plan Progressives dig in for fall fight with centrists MORE (D-N.Y.), Rashida TlaibRashida Harbi TlaibProgressives dig in for fall fight with centrists Progressives eye shift in strategy after high-profile losses House Democrats demand details after Border Patrol agents accused of profiling Latinos in Michigan MORE (D-Mich.) and Ayanna PressleyAyanna PressleyEviction ruling puts new pressure on Congress House members to urge FDA to remove in-person requirement for abortion medication Progressives eye shift in strategy after high-profile losses MORE (D-Mass.) are urging President BidenJoe BidenUS evacuates all Afghan embassy staff: report Biden visits FEMA headquarters as Ida slams New Orleans Romney: Afghanistan crisis the fault of both Biden, Trump administrations MORE to replace Federal Reserve Chair Jerome Powell as his term’s end date nears. 

The trio of progressive Democrats issued a statement on Monday calling on Biden to “re-imagine” a central bank that is “focused on eliminating climate risk and advancing racial and economic justice.”

The lawmakers said that while the central bank has “made positive changes to its approach to full employment reflected in the new monetary policy framework, their “concerns” with Powell’s “track record are two-fold.”

They specifically took issue with what they saw as the little action his Federal Reserve has taken to “mitigate the risk climate change poses to our financial system,” citing the D-minus rating for it received for its approach to climate risk policies from Positive Money’s Global Central Bank Scorecard.

That grade, according to the lawmakers, put the Federal Reserve “at the bottom of the G20 Central Banks.”

“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,” they wrote.

They also contended that the Federal Reserve under Powell’s leadership has “substantially weakened many of the reforms enacted in the wake of the Great Recession regulating the largest banks, including capital and liquidity requirements, stress tests, the Volcker Rule, and living will requirements.”

The lawmakers said rolling back those regulations that were established to prevent a disaster like the 2008 financial crisis from happening again “risks the likelihoods of Americans across the country.”

“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,” they wrote.

“We urge the Biden Administration to use this opportunity to appoint a new Federal Reserve Chair,” they added.

The trio said that Biden’s “consequential appointment” for the chair of the Fed “has the potential to remake the composition of the Board of Governors.”

Some lawmakers  and officials have joined the conversation regarding Powell’s future as February inches closer, airing their opinions on what Biden should do about the chief of the central bank as the country is still recovering from the difficulties faced amid the pandemic.

Powell, a Republican, was elevated to his position by former President TrumpDonald TrumpHouse panel tees up Trump executive privilege fight in Jan. 6 probe Romney: Afghanistan crisis the fault of both Biden, Trump administrations Biden allies say media missing the mark on Afghanistan MORE in 2018. Former President ObamaBarack Hussein ObamaBiden continues Trump’s flirtation with complacency Blue Origin’s Jeff Bezos wages lawfare on NASA and SpaceX The political tides are turning against the Biden presidency MORE, however, first appointed him to the Fed in 2012.

The chair of the Federal Reserve serves four-year terms.

Treasury Secretary Janet YellenJanet Louise YellenLarry Summers compares Fed policy to Vietnam, Afghanistan wars Biden faces another huge decision apart from COVID and Afghanistan Roughly 90 percent of federal rental aid still untapped: Treasury MORE is reportedly backing Powell’s reappointment, Bloomberg reported earlier this month, citing multiple people with knowledge of the situation.

Sen. Steven Daines (R-Mont.) has also thrown his support behind Powell landing another term, asking Biden in a letter to renominate him to the job.

Progressives, however, are split when it comes to Powell’s reappointment.

Some lawmakers, economists and activists arguing that his push for an employment-focused central bank is what the Fed needs to continue, while other liberals are contending that Powell undermined the economy when he scaled back key safeguards implemented by the Dodd-Frank Wall Street reform law.

Senate Banking Committee Chairman Sherrod BrownSherrod Campbell BrownEviction ruling puts new pressure on Congress On The Money: Progressives dig in for fall fight with centrists on Biden budget plan Fed reappointment splits progressives MORE (D-Ohio) and Sen. Elizabeth WarrenElizabeth WarrenCrypto debate set to return in force Newsom recall spurs unprecedented turnout campaign Biden faces another huge decision apart from COVID and Afghanistan MORE (D-Mass.) have both criticized Powell for his support of weakening bank rules.

Both, however, have not yet said if they will back his re-nomination.

The statement from Ocasio-Cortez, Tlaib and Pressley was first reported by Politico.