Update 500 – “Let’s End this Uncivil War”
… Starting with Presidential Nominations
Yesterday, Joe Biden’s swearing-in as the 46th President of the United States, and surrounding pomp and circumstance without incident, inspired a national sigh of relief for millions. Biden’s inaugural address called for national unity among Americans red and blue, rural and urban, and conservative and liberal. President Biden’s leadership embodies an appeal to political civility, without which, little progress will follow.
Vice President Kamala Harris swore in Senators-Elect Alex Padilla, Jon Ossoff, and Raphael Warnock later yesterday afternoon, officially cementing Democratic control of the Senate. The Senate turns now to three tasks: relief negotiations, an impeachment trial, and a bevy of nominations. Following our last review, we examine nominees expected to be key members of the Biden economic team and discuss the policy challenges they will face, if confirmed.
Janet Yellen, Treasury Secretary
President Biden nominated former Federal Reserve Chair Janet Yellen to lead the Treasury Department. Yellen previously served at the Council of Economic Advisors (CEA) under President Clinton. If confirmed by the Senate, she will become the first person to have headed the Treasury, the Federal Reserve, and the White House Council of Economic Advisors.
The Biden team announced yesterday a slew of hires who will serve under Yellen, including:
- Didem Nisanci, Chief of Staff
- Julie Brinn Siegel, Deputy Chief of Staff
- Alfred I. Johnson, Deputy Chief of Staff
- Jacob Leibenluft, Counselor to the Secretary
- Ryan Jacobs, Chief Speechwriter and Senior Advisor
As Treasury Secretary, Yellen will steer the US economy out of the pandemic-induced recession and address rampant income/wealth inequality. During her confirmation hearing at the Senate Finance Committee this week, Yellen stressed the need for additional economic stimulus targeted at the unemployed as well as struggling small- and medium-sized businesses.
Beyond stimulus, other challenges remain for the Treasury Secretary-to-be. The Trump administration weakened financial regulation, particularly the Financial Stability Oversight Council (FSOC). The Treasury Secretary chairs FSOC, which convenes the heads of financial agencies such as the Fed and the SEC and can exert influence over the direction of regulatory policy. Yellen will lead President Biden’s fiscal policy agenda, overseeing the IRS and managing the public debt.
Gary Gensler, SEC Commissioner
Gary Gensler served in the previous two Democratic administrations — in Bill Clinton’s Treasury Department as Assistant Secretary for Financial Markets and Under Secretary for Domestic Finance, and as Barack Obama’s chair of the Commodity Futures Trading Commission (CFTC) from 2009-2014. At the CFTC, Gensler was a leader in implementing crucial parts of Dodd-Frank financial reforms, particularly those addressing derivatives trading.
As CFTC chair, Gensler gained a reputation for being a reformist regulator willing to throw elbows — a bane of the big banks. His appointment as SEC chair signals a more rigorous approach to SEC enforcement compared to the previous four years. In particular, Gensler will oversee shadow banking, market structure, corporate buybacks, and corporate disclosure of information about climate impact. In recent years, Gensler has proven himself to be an expert on digital currencies, and as SEC chair he would have supervisory authority over what has previously been a lightly-regulated domain.
Rohit Chopra, Director of Consumer Financial Protection Bureau (CFPB)
Rohit Chopra is no stranger to the agency he has been nominated to lead — after beginning his career at McKinsey & Co., Chopra joined the Obama Treasury Department to help set up the newly formed Consumer Financial Protection Bureau. He served as CFPB’s Assistant Director, focusing on student loans and playing a role in President Obama’s Student Aid Bill of Rights. Since 2018, Chopra has served as a commissioner on the Federal Trade Commission, where he has been a dissenting voice against the Republican majority on the Commission and has advocated for stronger enforcement against tech companies.
Like Gensler, Chopra’s nomination to head CFPB signals more oversight and enforcement on the horizon — a significant shift in an agency that engaged in minimal (and at times counterproductive) enforcement action during the Trump administration. Chopra must rebuild the ten-year-old agency’s reputation as a watchdog of the financial services industry on behalf of consumers. Chopra will likely prioritize student loans — particularly the treatment of borrowers by private loan servicers — and a crackdown on payday lenders.
Gina Raimondo, Commerce Secretary
Rhode Island Governor Gina Raimondo is a former venture capital executive turned public servant. Governor Raimondo is known for her moderate, pro-business approach to governing. As Governor, Raimondo introduced job training programs, cut taxes, and eliminated nearly a third of Rhode Island’s business regulations.
If confirmed by the Senate, Raimondo will be in charge of unwinding the Trump Administration’s aggressive trade policy and translating Biden’s economic vision to the business community. Raimondo’s responsibilities will span far beyond trade, given the agency’s critical role in regulating technology to promote climate change. Raimondo’s first task will be delivering a complete and accurate census to Congress after years of lawsuits and mismanagement over the decennial count.
Marty Walsh, Labor Secretary
If confirmed, Mayor Marty Walsh of Boston would be the first union member to serve as Labor Secretary in nearly half a century. A local union president prior to becoming Mayor in 2014, Walsh has the backing of most major labor organizations and does not seem to be facing much opposition from within the Democratic party. As Secretary, Walsh will implement rules that advance Biden’s pro-worker agenda in the midst of one of the worst labor markets in American history.
Walsh will seek to ensure that workers are paid fair wages and overtime, mainly by reinstating reversed Obama-era regulations and enforcing prevailing wages laws. He will push for tougher OSHA enforcement and update health regulations, helping keep workers remain safe during the pandemic. On the issue of discrimination, Walsh can ensure that only companies that have no record of employment-based discrimination complaints receive federal contracts.
Pete Buttigieg, Transportation Secretary
Biden nominated the former South Bend Mayor Pete Buttigieg to head the Department of Transportation. Buttigieg is a graduate of Harvard and Oxford University and a U.S. Navy veteran. The former mayor ran as a candidate for president last year, becoming the first openly gay person to launch a major presidential campaign.
The Senate Committee on Commerce, Science, and Transportation held Buttigieg’s confirmation hearing for the role today. If confirmed, Buttigieg will play a role in tackling climate change and saving the transportation sector, which is still reeling from the pandemic. On the campaign trail, Biden vowed to repair and expand the nation’s highways, transit systems, and other infrastructure. Biden’s infrastructure plan also seeks to modernize the electric grid and reduce overall emissions from the transportation sector.
In contrast to President Trump’s, Biden’s Cabinet will be made up of capable, uncontroversial public servants. This Cabinet is bound to better reflect the country as a whole. Such supremely qualified picks will best position the federal government to take on challenges new and old, from rising economic inequality and administering the coronavirus response, to rolling back the backward Trump administration economic policies.
But the confirmation process has been slow out of the gate. By day one of their presidencies, President Trump had two Cabinet members approved by the Senate and President Obama had six. With only slim Democratic majorities in both chambers, Biden will need to rely on his decades of experience navigating Congress — the most of any president since LBJ — to further his progressive agenda. Biden’s mandate inspires hope of a more responsive and responsible government demanded by a people in need. Congress take note.