Democrats opposed Kevin Warsh 13-11 in committee on April 29 not for his policy record, which is on file, but for who nominated him. That is the first time it has happened to a Fed chair, and it is the precedent that will outlive this presidency.
On April 29, the Senate Banking Committee advanced Kevin Warsh's nomination to chair the Federal Reserve on a party-line 13-11 vote, with every Democrat in opposition. The vote was reported by CNBC and CBS News. It is, so far as the committee record shows, the first fully partisan committee vote on a Fed chair nominee since the Banking Committee took up that responsibility.
The steelman first. Democrats argue that any chair confirmed by a president who has publicly attacked the Fed's independence is, by association, a threat to it. Senator Elizabeth Warren made that case directly, calling Warsh a 'sock puppet,' and a Fortune piece quotes former Fed economist Claudia Sahm extending the concern to institutional capture. There is a real argument there. A central bank's independence is partly a function of perception, and a chair installed over unanimous opposition from one party begins his term with that perception damaged.
The trouble is that the argument cuts against the senators who made it. Warsh's policy record is not a mystery. He sat on the Board of Governors from 2006 to 2011 and dissented in 2010 against the second round of quantitative easing, on the stated ground that the committee was bending too easily to political pressure for accommodation. That is the opposite of the disposition Warren ascribed to him. A senator who believed the chair had to be insulated from White House pressure would treat a documented dissent against easy money as evidence for, not against, the nominee. None of the Democratic members engaged that record on the dais; several, per the committee tally, voted by proxy.
The Fed's April 29 FOMC statement ran the same morning as the committee vote, a useful reminder that the institution under debate is presently making real decisions under real political stress. The independence Democrats invoked is the institution's working capital. They drew it down.
A fair conservative concession: Trump's removal of Jerome Powell before the end of his term, which precipitated this nomination, was itself a break with norm. A senator who voted no in protest of that sequence is not acting in bad faith. But a unanimous bloc, voting by proxy, refusing to engage the nominee's twenty-year paper trail, has done more than register a protest. It has converted the chair confirmation into a partisan vote of the same shape as a circuit court vote. The next Democratic president who nominates a chair will be met by a Republican bloc citing this precedent. The independence of the Federal Reserve has been narrowed today, and not by the president who nominated Warsh.