President Joe Biden probably needs to come up with a new pick for the Federal Reserve after key Democratic Sen. Joe Manchin announced his opposition on Monday to nominee Sarah Bloom Raskin, according to analysts.
“Given that Republicans appear united in their opposition to her, Manchin’s decision is very likely to doom Raskin’s nomination,” said Ian Katz, managing director at Capital Alpha Partners, in a note.
“We wouldn’t be surprised if Raskin withdraws in the next week or two — perhaps sooner,” Katz added. He put Raskin’s chances at becoming the U.S. central bank’s vice chair for supervision at “no more than 30%, even though the White House said Monday that it’s ‘working to line up the bipartisan support that she deserves.’”
Manchin said Monday that he’s “unable to support” Biden’s nomination of Raskin.
“Her 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 nation’s critical energy
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needs,” said the West Virginia lawmaker said in a statement.
Biden is now likely to pick someone who hasn’t signaled opposition to the fossil fuel industry, according to Tobin Marcus, a policy and politics strategist at Evercore ISI.
“Raskin has been criticized for her quite radical proposal early in the pandemic for the Fed to implement its market stabilization policies, including corporate bond-buying, in a way that did not support fossil fuel businesses,” Marcus said in a note.
“We have no reason to doubt that a different progressive-leaning regulator, without idiosyncratic liabilities on energy policy and ethics questions, would be a potentially viable nominee.”
The president probably will replace Raskin “with a similarly tough regulator, rather than offer a markedly more moderate pick in the hopes of bipartisan acceptability,” the Evercore ISI analyst predicted.
Manchin’s view on nominations and other issues is crucial as the Senate is split 50-50, with Democrats in control of the chamber only because Vice President Kamala Harris can cast tiebreaking votes.
Raskin probably will not get confirmed, but that won’t affect big banks
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said Cowen Washington Research Group analyst Jaret Seiberg said in a note.
“We still expect other Democrats at the Fed to advance the same agenda,” Seiberg wrote.
When asked by a reporter on Monday whether any Republican senators have said they would support Raskin, White House press secretary Jen Psaki didn’t answer the question, but Psaki later said the administration did see a path for the nominee to win confirmation.