(NBC News) - Sen. Elizabeth Warren, D-Mass., slammed Federal Reserve Chair Jerome Powell in an interview Sunday on NBC News' "Meet the Press," saying he "has failed" and shouldn't be in his role.
"He has had two jobs. One is to deal with monetary policy. One is to deal with regulation. He has failed at both," she said.
"Look, I don't think he should be chairman of the Federal Reserve. I have said it as publicly as I know how to say it. I've said it to everyone," said Warren, who is on the Senate Banking Committee.
Powell, first nominated by President Donald Trump in 2017, has faced criticism over his handling of banking regulations after the collapse of Silicon Valley Bank.
Warren, who has been pressing for stricter banking regulations, said Powell “took a flamethrower to the regulations” when Trump was in office, adding that Trump gave Congress the “authority to lighten the regulations even more.”
"And then the CEOs of the banks did exactly what we expected. They loaded up on risk that boosted their short-term profits. They gave themselves huge bonuses and salaries and exploded their banks," Warren said.
In a letter Saturday, Warren urged the inspectors general at the Treasury Department, the Federal Deposit Insurance Corp. and the Fed Board of Governors to immediately open a "thorough independent investigation" to determine the causes of the bank management and regulatory issues that led to the collapse of SVB and Signature Bank.
“The bank’s executives, who took unnecessary risks or failed to hedge against entirely foreseeable threats, must be held accountable for these failures,” Warren wrote, asking for preliminary findings of the probe to be delivered to Congress within 30 days.
A group of Democrats led by Warren and Rep. Katie Porter of California announced legislation last week to restore bank regulations that were undone in 2018, during the Trump administration — an effort they say would address the cause of SVB's collapse.
At the time, Republicans in Congress pushed a bill — with the support of some centrist Democrats — that eased Dodd-Frank financial regulations on midsize banks, raising the “too big to fail” threshold from $50 billion in assets to $250 billion. The Warren-Porter bill, first reported by NBC News, would repeal that measure, but it faces a tough road to passage in Congress.
Some Democrats who voted for the 2018 bill are standing by their votes, joining Republicans in resisting more scrutiny for banks and arguing that the U.S. still has ways under existing law to tackle the issue.
President Joe Biden renominated Powell as Federal Reserve chairman in November 2021. The decision was met with pushback from some progressives, and certain Democrats had argued that Powell was too hands-off as a banking regulator.
Around that time, Warren was a leading opponent of Powell, calling him a "dangerous man" who had led an effort to weaken the nation's banking system at a hearing in late 2021.
Warren urged Powell to recuse himself from an internal probe into SVB last week, saying his actions "directly contributed to these bank failures."
“I’ve opposed him because of his views on regulation," Warren said Sunday on "Meet the Press," "and what he was already doing to weaken regulation."
By Summer Concepcion
March 19, 2023
