Kevin Warsh faced sharp questions on Capitol Hill on Wednesday as senators pressed him over the Federal Reserve chair job, his views on monetary policy and whether he could stay independent from President Trump. Warsh told lawmakers he would protect the Fed’s independence if confirmed.
The hearing put Warsh in the center of one of the most sensitive jobs in Washington at a time when Trump has criticized Jerome Powell, threatened to fire him and pushed him to cut interest rates. Warsh, a former Fed governor, said the institution needs reform and new leaders with high ethical standards to restore what it should be.
Warsh argued that the economy is still paying for policy mistakes in 2021 and 2022, warning that once inflation takes hold it becomes more expensive and harder to bring down. He said the sooner he and his colleagues can reform the Fed, the sooner price stability can be secured.
“I take my responsibility to be an independent leader of the Federal Reserve very seriously, if confirmed by this body,” Warsh said. He also said the president never asked him to predetermine, commit, fix or decide any interest-rate decision in their discussions, and added that he would never agree to do so.
A senator told Warsh that many lawmakers were worried about the integrity of the Federal Reserve, the economy, inflation and his independence. Tim Scott backed Warsh, saying his earlier service at the Fed during the Great Recession left him battle-tested and able to understand how economic decisions affect jobs and growth.
Warsh’s confirmation fight now turns on whether senators believe he can separate the Fed’s decisions from Trump’s pressure campaign. That question is likely to shadow the nomination as long as Powell remains in the White House’s crosshairs.
