Politics: ‘Radical Biden nominee faces backlash from banks’

Joe Biden knows what you want from COVID-19 to child care. But can he deliver?

  Joe Biden knows what you want from COVID-19 to child care. But can he deliver? From the pandemic relief bill, to help for working parents to empathy for climate change victims, Biden knows how to give. But can he act soon enough?For the Opposing View by Gov. Kristi Noem, read If President Biden mandates vaccines, South Dakota will see him in court.

President Joe Biden's decision to nominate Cornell law professor Saule Omarova to regulate the nation's banks is triggering intense anxiety among the lenders and their Washington lobbyists and threatens to set off a bruising battle in Congress.

a city with smoke coming out of it: The nomination of Saule Omarova as comptroller of the currency by President Joe Biden has set off alarm bells in the financial services industry. © (AP Photo/Mark Lennihan) The nomination of Saule Omarova as comptroller of the currency by President Joe Biden has set off alarm bells in the financial services industry.

Omarova is more than just a finance industry critic — she has proposed essentially ending the banking industry as we know it by letting the Federal Reserve take on the deposit accounts of all Americans.

France recalls ambassadors to US, Australia over submarine deal

  France recalls ambassadors to US, Australia over submarine deal The diplomatic row came over a broken contract by Australia to buy French submarines in the wake of a new security pact by Australia, the US and the UK.Philippe Étienne, France's ambassador to the United States, and his counterpart in Australia were recalled to Paris "for consultations" at the request of French President Emmanuel Macron, said Jean-Yves Le Drian, France's minister for Europe and foreign affairs.

News of her nomination this week to be comptroller of the currency has touched off a scramble among Washington's powerful bank lobbying associations about whether to take the rare and risky step of speaking out against someone who could end up being the industry's top regulator. Groups including the American Bankers Association are plotting whether to publicly fight back or gin up opposition behind the scenes as their members raise alarms, according to more than a half-dozen industry sources.

“We have serious concerns about her ideas for fundamentally restructuring the nation’s banking system, which remains the most diverse and competitive in the world," American Bankers Association President and CEO Rob Nichols said in a statement.

Psaki forced to cut her family vacation short to address Afghanistan

  Psaki forced to cut her family vacation short to address Afghanistan White House press secretary Jen Psaki was forced to cut her planned family vacation short, returning to work Monday as President Joe Biden delivered remarks on Afghanistan. She'll brief reporters Tuesday afternoon at 1:30, alongside National Security Advisor Jake Sullivan, as the crisis continues to unfold. Psaki had planned to take this week off, with her automated out-of-office reply saying she would return on August 22, when reporters tried asking her questions about Afghanistan over the weekend.

The nomination risks opening up the biggest rift yet between bankers and Biden, who has been under pressure from the left to pick regulators with a clear track record of challenging Wall Street. So far, Biden's nominees for financial agencies, including the Securities and Exchange Commission and the Consumer Financial Protection Bureau, have largely aligned with the goals of the party's progressive wing. Omarova's appointment is another victory for industry critics like Sen. Elizabeth Warren (D-Mass.), though with widespread opposition from banks she might face a far more difficult path to confirmation than Biden's other nominees.

"Saule Omarova's nomination to lead the OCC is tremendous news," Warren said in a statement. "Saule is an excellent choice to oversee and regulate the activities of our nation's largest banks, and I have no doubt she'll be a fearless champion for consumers.”

Inside Biden's falling poll numbers: 5 reasons why the president's approval ratings have dropped

  Inside Biden's falling poll numbers: 5 reasons why the president's approval ratings have dropped Perhaps most troubling for President Biden: His support among independent voters – who helped carry him to victory over Donald Trump – has cratered.Biden's job approval dipped below 50% in several polls for the first time last month, and this week brought new lows: Gallup found Biden's approval rating has fallen to 43%, a 6-percentage point drop since August and the lowest of his presidency. A new Pew Research Center survey released Thursday has Biden's approval rating at 44%.

As an academic, Omarova has argued that the financial system is dysfunctional and needs a fundamental reevaluation to make it "more inclusive, efficient and stable." Her solution — and the greatest source of angst among lenders because of what it reveals about her philosophy — is that the business of holding consumer deposits should be taken away from banks and run by the Federal Reserve.

Omarova said in a paper published in October that having Americans park their money at the Fed would allow the central bank to more directly and efficiently pull the levers of monetary policy by enabling it to credit individual citizens' accounts when there's a need to stimulate the economy. The system she envisioned would mark the end of the federal government's backing of bank deposits and other subsidies, meaning it would also eliminate the "too big to fail" problem in which Washington bails out big banks when they hit the skids.

"Banks, in other words, will not be 'special' anymore," Omarova wrote. "By separating their lending function from their monetary function, the proposed reform will effectively 'end banking,' as we know it."

Live updates: Biden vows action for treatment of Haitian migrants; Mayorkas says migrants gone from bridge camp

  Live updates: Biden vows action for treatment of Haitian migrants; Mayorkas says migrants gone from bridge camp Biden vowed action in his first extensive remarks on border patrol agents on horses who chased and seemed to whip Haitian migrants with their reins.“It’s outrageous. I promise you those people will pay. They will be investigated. There will be consequences,” Biden said in response to a reporter's question at the White House.

If confirmed to run the Office of the Comptroller of the Currency — as the first woman and person of color to hold the job — Omarova would not have the power to reshape the Fed. But banks see her proposals as a clear indication of a likely crackdown on the industry, which has often enjoyed a cozy relationship with the agency.

Omarova told POLITICO earlier this year that large financial institutions “hold so much power now and they move so much money through their own channels that it is effectively impossible through just rules and some enforcement to really shape what it is they’re doing.”

In a message sent to bank executives Thursday, ABA's Nichols said Omarova had expressed "radical views" on how to restructure the banking system. He said his organization was already working with national and state trade associations "to ensure that the senators who will consider this nomination fully understand Professor Omarova's positions on these issues."

"Many of Dr. Omarova’s statements raise serious concerns about how she would oversee the well-regulated, well-supervised banking system, protect consumers and work with an industry critical to financing the American Dream for families and small businesses," Consumer Bankers Association spokesperson Lauren Bianchi said. "It is our hope these fundamental questions will be at the heart of any confirmation hearing in the U.S. Senate.”

Cowardly lyin' Biden dodges questions about his record of radical failure

  Cowardly lyin' Biden dodges questions about his record of radical failure Today I was going to write about the sheer cowardice shown by President Joe Biden in his astonishing, repeated avoidance of press questions except under the most tightly controlled conditions. © Provided by Washington Examiner I couldn’t get inspired to finish it. Why? Because compared to everything else Biden is doing wrong, his hiding from the press seems the least of our worries. This presidency already is so awful as to be frightening. Observers from friendly foreign nations are now openly accusing Biden of “serious mental decline,” and they may be right.

Omarova, a native of Kazakhstan who served at the Treasury Department under former President George W. Bush and worked as a lawyer at Davis Polk, did not respond to a request for comment.

Bank trade groups typically stay out of public debates about nominees who may end up regulating their members. In the case of Omarova, lobbyists are inching toward breaking with that precedent.

Part of the industry's calculation is whether it's worth the inevitable political blowback banks would face by launching a public opposition campaign, with Omarova already facing a real risk of not being confirmed. She is likely to see universal opposition from Senate Republicans, and her confirmation will hinge on whether business-friendly Democrats are comfortable with her approach.

"If they do respond forcefully," a Senate GOP aide said of the banks, "then I think we'll find a more interesting conundrum for the moderate Democrats."

Spokespeople for some of the moderates that banks will target — Sens. Jon Tester (D-Mont.), Kyrsten Sinema (D-Ariz.) and Joe Manchin (D-W.Va.) — did not respond to a request for comment. Sen. Mark Warner (D-Va.) said he was not familiar with her background and that he wanted "to do a little bit of due diligence first." Warner, Tester and Sinema are all members of the Banking Committee, which will vet her nomination.

The same Democrats will face pressure to support Omarova from liberal groups like Americans for Financial Reform, which says she "has a broad sense of what financial regulation is about, both from the perspective of protecting consumers and guarding against systemic risk."

"I believe she may have some difficulty getting confirmed given her position on various policy issues," said Cam Fine, the former CEO of the Independent Community Bankers of America, which represents small banks. "At the very least it will be sometime next year before she would have a chance to get confirmed, which then runs her into the mid-terms. So we shall see how this plays out."

Congress is still at odds over Biden's infrastructure, budget plan. What would a deal mean for the president? .
Biden told House Democrats his $3.5 trillion budget bill must be reduced to pass the Senate. The White House says it will remain 'historic.'But after days of intense negotiations failed to bridge an agreement heading into the weekend, Biden faces increasing pressure to show that Democrats can deliver.

See also