Sen. Joe Manchin of West Virginia likely killed the Biden administration’s nomination of Sarah Bloom Raskin to the Federal Reserve Board. Manchin cited Raskin’s opposition to carbon-based fuels as the primary reason that he could not support her.
“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 needs,” Manchin said in a statement.
One day after Manchin’s statement, Raskin sent a letter to President Biden withdrawing her name from consideration.
Environmentalists embraced Raskin as a climate change warrior. In 2020, in the early stages of the pandemic, Raskin penned an op-ed in the New York Times where she called on the Fed’s emergency loan program to exclude fossil fuel industries, identifying them as climate and economic losers.
“The Fed is ignoring clear warning signs about the economic repercussions of the impending climate crisis by taking action that will lead to increases in greenhouse gas emissions at a time when even in the short term, fossil fuels are a terrible investment,” Raskin wrote.
Instead, Raskin argued the Fed should help steer investment toward green energy.
Manchin viewed that hostility toward oil, natural gas and coal as antithetical to the role of the nation’s central bank. “The Federal Reserve Board is not an institution that should politicize its critical decisions,” he said.
Sen. Shelley Moore Capito of West Virginia was already on record against Raskin’s appointment. She said Raskin’s “terrible investment” comment demonstrates “just how out of touch she is — especially when it comes to understanding the importance of West Virginia’s coal and natural gas to the country.”
The timing hurt Raskin’s nomination as well. Russia’s invasion of Ukraine, the increased global demand for energy and skyrocketing gasoline prices in this country have brought renewed focus on the importance of an energy strategy that includes fossil fuels.
The Wall Street Journal opined that Raskins’ well-documented beliefs that the Fed must do more to slow climate change and steer banks and investors away from fossil fuel companies are out of step with the current energy reality.
“She wants to use financial regulation to redirect capital from fossil fuels. She’s the wrong person for the wrong job at the wrong time,” said the Journal.
The United States is already moving more toward renewables and away from traditional energy sources. But the events of recent months demonstrate that is a circuitous course. The country and the rest of the world still need fossil fuels now and will continue to need them for a long time.
Capito and Manchin are correct. Raskin’s devotion to using the immense power of the Federal Reserve to speed up the transition by directing capital away from fossil fuels would be an abuse of her authority and a hardship to the country’s energy economy.
President Biden’s left flank is in mourning. The New Yorker magazine declared that Raskin’s withdrawal “dooms the most powerful central bank in the world to a state of willful blindness regarding the looming chaos that scientists predict climate change will unleash.”
While the Fed is immensely powerful, we are going to call BS on Raskin’s failed nomination dooming the planet, and hope that Biden’s next nominee has a more traditional view on the role of the central bank.
