Shelton Fed Bid Likely Doomed With Senate’s Holiday Departure

Judy Shelton’s chance of getting confirmed to the Federal Reserve Board was left hanging by a fraying thread after the Senate left Washington Wednesday for a holiday recess without planning another vote on her nomination.

President Donald Trump’s pick of the controversial economist ran into bipartisan resistance, the political calendar and the pandemic, leaving her with little chance of confirmation before a new Congress and a new president take over next year.

The Senate returns to work Nov. 30, but Senate Majority Leader Mitch McConnell hasn’t yet put a vote on Shelton to join the Fed board on the schedule. The task of getting her confirmed will only get harder after that.

McConnell’s attempt to push Shelton’s nomination through the Senate this week was derailed by the absence of Republican Senators Chuck Grassley of Iowa and Rick Scott of Florida as they quarantined after being exposed to Covid-19. Grassley has since tested positive, though he says he has no symptoms, and Scott’s spokesman said the senator has been negative so far for infection.

With Republican Senators Mitt Romney and Susan Collins joining with 45 Democrats and two independents in opposing Shelton, McConnell was one vote short of advancing the nomination Tuesday. The Senate leader switched his own vote to no in order to preserve the option of bringing it up later.

Arizona Flip

But Shelton’s odds of getting confirmed later are plummeting.

The Senate is scheduled to return from the Thanksgiving recess the same day Democrat Mark Kelly will be certified in Arizona as the replacement for Republican Senator Martha McSally after this month’s special election. He could be sworn in that day. That would narrow the Republican advantage in the chamber by one vote, to 52-48.

In addition, a third Republican opponent of Shelton, Lamar Alexander of Tennessee, was absent this week but is expected to return.

If all members of the Senate vote, and assuming Kelly votes with fellow Democrats, Shelton’s nomination would be defeated 51-49.

Still Confident

McConnell on Wednesday offered no indication of his plans. At the White House, spokesman Judd Deere reiterated his statement after Tuesday’s failed vote that the administration remains confident that Shelton “will be confirmed upon reconsideration.”

Shelton was nominated alongside Christopher Waller, research director at the Federal Reserve Bank of St. Louis. While McConnell hadn’t scheduled a vote on Waller or said whether he will, he has bipartisan support and still could get confirmed.

Trump first announced his nomination of Shelton 16 months ago, and due to a lack of Republican commitments of support, McConnell didn’t schedule it for a full Senate vote until days ago.

The history of views of the 66-year-old economist and former informal adviser to Trump made some in the GOP resistant. She was long known for her advocacy of a return to the gold standard, ultra-hawkish views on inflation and opposition to federal deposit insurance. She provoked further controversy and opposition by abandoning those opinions and calling for interest-rate cuts — aligning herself with Trump as she emerged as a candidate for the Fed post.

Economist Opposition

Former Fed officials and a group of prominent economists, including seven Nobel Prize winners, signed letters this year urging senators to reject her nomination.

Trump previously advanced four other people to fill the two vacant board seats, all of whom failed to make it to confirmation.

His failed Fed choices have included people too partisan or unorthodox to garner enough support in the Senate, including the former Republican presidential candidate Herman Cain, who has since died, and Stephen Moore, an economist at the conservative Heritage Foundation who advised Trump’s 2016 campaign. Cain and Moore withdrew from consideration in the face of opposition from Senate Republicans.

The Senate also didn’t act in 2018 on the nominations of two more mainstream candidates, economists Nellie Liang and the late Marvin Goodfriend, who withdrew from consideration.

The highly partisan post-election scrum comes amid other efforts to confirm Trump nominees before the Jan. 20 inauguration of President-elect Joe Biden.

— With assistance by Erik Wasson

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