Sarah Bloom Raskin’s Radical Climate Change Agenda for the Federal Reserve
President Joe Biden recently nominated Sarah Bloom Raskin to serve as Vice Chair for Supervision of the Board of Governors of the Federal Reserve System. If confirmed, Raskin would be put in charge of regulating the U.S. financial system and become a pivotal voice in setting interest rates for our Nation’s banks. Unfortunately, Raskin’s recent public statements underscore a desire to transform the Fed into a politicized institution of climate change advocacy40-year high inflation record-high energy prices .
Raskin’s longstanding and recent attack on U.S. oil and gas companies shows a commitment to an ideology that defies practical judgment, considering the record-high energy prices we are facing in this country and is an inaccurate view of the Federal Reserve’s duty as the key regulator of our Nation’s banks. Raskin claims that financial institutions, including the central bank, need to be used to move our Nation into a “net-zero economy and away from climate change disaster.” Raskin believes that the central bank should weaponize stress testing to go after the oil and gas industry, regarding it as a financial regulatory tool that regulators should use to penalize banks serving fossil fuel companies. At issue here is that Raskin, as an unelected bureaucrat, wants to divert capital from fossil fuel companies. However, activist intervention is not part of the mission of the Federal Reserve, which is instead tasked with regulating the U.S. banking system and money supply to ensure low, stable inflation and support strong economic growth. It is certainly not the role of those serving on the Fed to go after a specific industry to achieve an unrelated political desire, which is what Raskin seems to want to do by acting as a climate change advocate. Choosing favored industries to funnel capital to, based on personal political desires, would be a radical move for a nominee to the Federal Reserve.
Sen. Pat Toomey (R-PA), Ranking Member of the Senate Banking Committee, recently commented that if confirmed, Raskin “would abuse the Fed’s narrow statutory mandates on monetary policy to have the central bank actively engaged in capital allocation. Such actions not only threaten both the Fed’s independence and effectiveness but would also weaken economic growth.” As Sen. Toomey believes, it is important that whoever serves be impartial to the industries they regulate. The Fed should not be used by those serving on its board to advocate for a radical far-Left agenda.
Amid rising gas prices and the ongoing crisis in Ukraine, the U.S. should renew efforts to ensure we are energy independent. This would provide much-needed relief for Americans at the gas pump and end our reliance on adversaries for our energy needs. Raskin’s nomination to the Fed conflicts with the idea of an independent Federal Reserve and risks driving up our already rising energy costs.
Miles Johnson serves as Government Affairs Manager for the America First Policy Institute (AFPI).