Washington (EFE).- The candidate nominated by United States President Donald Trump to chair the Federal Reserve, Kevin Warsh, pledged on Tuesday to safeguard the institution’s autonomy regarding interest rates during a contentious Senate confirmation hearing.
«Monetary policy independence is essential,» Warsh told the Senate Banking Committee in his opening statement, addressing the main issue surrounding his nomination.
«I do not believe the operational independence of monetary policy is particularly threatened when elected officials, presidents, senators, or members of the House (of Representatives) state their views on interest rates,» he added.
Walsh claimed that the Federal Reserve is still suffering from monetary policy errors made during the pandemic, and unveiled policies aimed at curbing inflation.
He criticized the Fed for failing to meet its inflation target since the pandemic by saying that once inflation takes root in the economy, it becomes more costly and difficult to reduce.
During the hearing, the senators questioned Warsh about his involvement in the 2007 – 2008 financial crisis while he was at the Fed.
Senator Elizabeth Warren, a Democrat from Massachusetts, noted that Warsh worked at the Federal Reserve before, during, and after the crash.
Warren, one of the toughest senators in Tuesday’s session, also focused her questioning on the independence of the Fed Chair.
«Let’s check out your independence and your courage. We’ll start easy. Mr. Warsh, did Donald Trump lose the 2020 election?»
The nominee to chair the Fed refused to confirm the results of the 2020 election when Warren repeatedly asked him to do so.
«If you can’t answer these questions, you don’t have the courage, and you don’t have the independence,» Warren added.
Warsh stated that under no circumstances would he be anyone’s «human sock puppet,» a term Warren used several times during the hearing.
“In sum, I believe that monetary policy independence is earned, and better policy decisions crafted, by steering clear of distractions,» Warsh claimed without elaborating further.
He said he was honored that the president had nominated him for the position and that he would be an independent actor if confirmed as Federal Reserve chair.
Warren and other Democratic senators questioned Warsh about his wealth, to which he responded by saying that part of his fortune is subject to confidentiality agreements.EFE
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