Economic Policy Has Become a Partisan Game. That Could Do Long-Term Harm.
It created the looks that she was a partisan actor who, somewhat than apply a constant philosophy to attempt to make the American financial system as wholesome as it may be, would pivot on a dime to attempt to strengthen the financial system throughout a Republican administration and gradual it in a Democratic one.
On Tuesday, in a dramatic second, with Senator Kamala Harris (now additionally the vice president- elect) racing to Washington and two Republican senators rendered unavailable for coronavirus-related reasons, Ms. Shelton fell simply in need of the votes wanted to place her on monitor to affix the Fed’s board of governors.
There is not any trendy precedent for a president to attempt to fill Fed governor seats whereas a lame duck, and if confirmed Ms. Shelton can be the primary Fed governor to take workplace with out affirmation votes from the other celebration. (The Senate nonetheless has time to verify her, however the math is tenuous.)
To Democrats, the last-ditch effort to verify Ms. Shelton implied not solely that Mr. Biden would have one much less necessary financial coverage appointment to make, but additionally that he might need to cope with a policymaker in search of to undermine his administration from throughout the central financial institution. (Mr. Trump has additionally nominated a second Fed governor, Christopher Waller, who could be confirmed earlier than Mr. Biden takes workplace — although he falls extra squarely within the custom of Fed governors with technocratic independence, and has attracted some Democratic assist.)
Only a dozen years in the past, take into account what occurred throughout the transition from George W. Bush to President Obama. The financial system was within the worst part of the worldwide monetary disaster, and President Bush had secured a $700 billion monetary rescue package deal from Congress simply earlier than the election.
That financial institution rescue, referred to as the Troubled Asset Relief Program, was divided into two $350 billion tranches, with the president required to ask Congress for the second tranche to acquire it. Not solely did President Bush not attempt to block the Obama staff from getting access to the bailout cash upon taking workplace, however at Mr. Obama’s request he additionally took the politically unpopular step of requesting the second tranche in January 2009, days earlier than Mr. Obama was inaugurated.
That step helped preserve a bipartisan gloss on the monetary rescue, gave the Obama administration entry to the funds sooner somewhat than later, and enabled Mr. Obama to take workplace with out making one in all his first actions the politically poisonous act of asking for extra financial institution bailout cash.
