Senators Looking for Leverage Find Yellen

Janet Yellen, Obama's choice for next leader of the Federal Reserve.
National Journal
Catherine Hollander
Add to Briefcase
Catherine Hollander
Oct. 31, 2013, 4:06 p.m.

Sen. Lind­sey Gra­ham said he would block Janet Yel­len’s nom­in­a­tion as Fed­er­al Re­serve chair­wo­man to get more in­form­a­tion re­leased on the Benghazi at­tack. Sen. Rand Paul said he would hold up the nom­in­a­tion for a vote on his bill.

In an en­vir­on­ment where pre­cious little le­gis­la­tion gets passed, law­makers look­ing for lever­age on is­sues have few places to turn. One of them is hold­ing up nom­in­a­tions — and Yel­len’s is a big one.

“It’s the only lever­age we have,” Gra­ham said.

And so, in a time-honored Cap­it­ol Hill tra­di­tion, Yel­len is be­ing made a pawn in oth­er fights.

For Gra­ham, R-S.C., that means gath­er­ing more in­form­a­tion about the at­tack on the U.S. con­su­late last year. “I’m go­ing to block fu­ture nom­in­a­tions com­ing from the ad­min­is­tra­tion, not be­cause I want to shut any­thing down — be­cause I want to open something up,” he said at a news con­fer­ence.

For Paul, R-Ky., that means a vote on his bill to broaden the abil­ity of the Gov­ern­ment Ac­count­ab­il­ity Of­fice to audit the Fed. Paul has been crit­ic­al of the Fed’s policies but sug­ges­ted he is open to con­sid­er­ing Yel­len’s nom­in­a­tion.

“I look for­ward to an in-depth dis­cus­sion in de­bat­ing her nom­in­a­tion, but my ul­ti­mate de­cision will rest on her po­ten­tial ef­fect­ive­ness in re­form­ing that his­tor­ic­ally ir­re­spons­ible in­sti­tu­tion,” he wrote in a Time ed­it­or­i­al after the White House an­nounced Yel­len’s nom­in­a­tion in Oc­to­ber.

In­deed, as the num­ber of laws passed by Con­gress in each ses­sion has de­clined over dec­ades, the use of holds has ris­en, says G. Calv­in Mack­en­zie, a pro­fess­or of gov­ern­ment at Colby Col­lege. It’s im­possible to know just how many are used today; they aren’t quan­ti­fied any­where. In 2011, the Sen­ate voted to end “secret holds,” which al­lowed law­makers to an­onym­ously block nom­in­ees.

But ac­cord­ing to Sarah Bind­er, a seni­or fel­low in gov­ernance stud­ies at the Brook­ings In­sti­tu­tion, com­pli­ance with the new rule is im­per­fect. “As the parties move farther and farther apart, it prob­ably in­creases the in­cent­ive to use more ob­struct­ive pro­ced­ures and ex­ploit them,” said Bind­er.

Nom­in­ees are blocked for all kinds of reas­ons. Some­times they over­come them, as Fed­er­al Re­serve Chair­man Ben Bernanke did in 2010 when Sens. Bernie Sanders, Jim De­Mint, Jim Bun­ning, and Dav­id Vit­ter vowed to block his nom­in­a­tion. Some­times they find a way around, as when Pres­id­ent Obama used a re­cess ap­point­ment to in­stall Richard Cordray as the first head of the Con­sumer Fin­an­cial Pro­tec­tion Bur­eau.

Some­times they don’t. In 2011, No­bel laur­eate Peter Dia­mond penned a scath­ing New York Times op-ed, “When a No­bel Prize Isn’t Enough,” to an­nounce his with­draw­al from con­sid­er­a­tion to serve on the Fed’s Board of Gov­ernors after his con­firm­a­tion was blocked three times.

Yel­len is less likely to be chal­lenged on the suit­ab­il­ity of qual­i­fic­a­tions for the job than Dia­mond, who, des­pite his No­bel Prize, had nev­er served at the cent­ral bank. Yel­len has been the Fed’s vice chair­wo­man since 2010 and pre­vi­ously headed one of its re­gion­al branches.

But the Fed’s ac­tions dur­ing and after the fin­an­cial crisis are sure to col­or her con­firm­a­tion hear­ings, and Paul is among the Re­pub­lic­ans who have raised ques­tions about the Fed’s stim­u­lus ac­tions.

The good news for Yel­len? As the Fed’s cur­rent vice chair­wo­man, she’ll be­come the act­ing chair­wo­man on Feb. 1 when Bernanke’s term ex­pires — even if she hasn’t been con­firmed by Con­gress.

What We're Following See More »
FCC Tightens Internet Privacy Standards
11 hours ago

Along party lines, the Federal Communications Commission on Thursday voted to tighten privacy standards for Internet service providers. "The regulations will require providers to receive explicit customer consent before using an individual’s web browsing or app usage history for marketing purposes. The broadband industry fought to keep that obligation out of the rules."

Obama Commutes Another 98 Sentences
11 hours ago

President Obama commuted the sentences of another 98 drug offenders on Thursday. Most of the convicts were charged with conspiracy to distribute drugs or possession with intent to distribute. Many of the sentences were commuted to expire next year, but some will run longer. Others are required to enroll in residential drug treatment as a condition of their release.

Clinton Up 9 in USA Today Poll; Up 3 According to Fox
16 hours ago

A new USA Today/Suffolk University poll finds Clinton leads Trump by 9 points nationwide, 47% to 38%. A Fox News national poll has Clinton up just three points, 44% to 41% over Trump.

Cruz: Eight Justices Could Be an Ongoing Situation
18 hours ago

Sen. Ted Cruz (R-TX) said that "there was “precedent” for a Supreme Court with fewer than nine justices—appearing to suggest that the blockade on nominee Merrick Garland could last past the election." Speaking to reporters in Colorado, Cruz said: "I would note, just recently, that Justice Breyer observed that the vacancy is not impacting the ability of the court to do its job. That’s a debate that we are going to have.”

DNC Sues RNC Over Trump’s Rigged Vote Comments
21 hours ago

The Democratic National Committee sued the Republican National Committee in U.S. District Court in New Jersey for aiding GOP nominee Donald Trump as he argues that the presidential election is "rigged." The DNC claims "that Trump's argument is designed to suppress the vote in minority communities."


Welcome to National Journal!

You are currently accessing National Journal from IP access. Please login to access this feature. If you have any questions, please contact your Dedicated Advisor.