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Top Democrats call on Biden to dump Powell as Fed chair

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
US Federal Reserve Chair Jerome Powell speaks during a news conference, Tuesday, March 3, 2020. | (AP photo)

American congresswomen Alexandria Ocasio-Cortez, Rashida Tlaib, and Ayanna Pressley have called on President Joe Biden to replace Federal Reserve Chair Jerome Powell to be replaced.

Stepping up the pressure on Biden as he draws closer to a decision on the most important economic post, the high-profile progressive Democrats issued a joint statement on Monday opposing Powell.

The progressives are urging Biden to reshape the Fed, America’s central banking system which some analysts say is the basic source of the economic trouble in the country.

“As news of the possible reappointment of Federal Reserve Chair Jerome Powell circulates, we urge President Biden to re-imagine a Federal Reserve focused on eliminating climate risk and advancing racial and economic justice,” the lawmakers said in a joint statement to POLITICO. “We urge the Biden Administration to use this opportunity to appoint a new Federal Reserve Chair.”

They acknowledged that the Fed under Powell “has made positive changes”, but added they want to see someone running the central bank who is more aggressive on financial regulation and climate change.

“Under his leadership, the Federal Reserve has taken very little action to mitigate the risk climate change poses to our financial system,” said Ocasio-Cortez (N.Y.), Tlaib (Mich.) and Pressley (Mass.), all of whom sit on the House Financial Services Committee.

Reps. Chuy García (D-Ill.), another committee member, and Mondaire Jones (D-N.Y.) also signed on the letter.

“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 said.

The previous Democratic administration of President Barack Obama had given the Federal Reserve new powers to oversee the financial system and regulate it.

In 1983, the Texas Republican proposed legislation to audit the Federal Reserve, but it failed to gain much support at the time.

However, in September 2014, the US House of Representatives, overwhelmingly approved similar legislation, authorizing the Government Accountability Office (GAO) to audit the Federal Reserve's board of governors.



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