January 31, 2020

Senator Warren Questions Fed Nominee Dr. Judy Shelton About Qualifications for the Job

Warren Raises Alarm about Shelton's Prior Statements on Economic Policy, Fed Independence

Text of the Letter (PDF)

Washington, D.C. -- United States Senator Elizabeth Warren (D-Mass.), a member of the Senate Committee on Banking, Housing, and Urban Affairs, wrote to Dr. Judy Shelton, President Trump's nominee to be a member of the Federal Reserve Board of Governors (Fed), expressing significant concerns with her nomination and asking that she explain a number of inaccurate, radical and contradictory statements suggesting a lack of economic expertise and political independence.

The seven members of the Board of Governors have ultimate control over the policies of the Federal Reserve, and, once confirmed by the Senate, generally serve for a 14-year term. Congress designed the Fed to be largely independent of short-term political pressures by instituting lengthy, staggered terms for its Governors, separating it from the Congressional appropriations process, and prohibiting administration officials from serving on its Board. 

In her letter to Dr. Shelton, Senator Warren expressed concern that if confirmed to the Fed, Dr. Shelton would be unable to act based on evidence and independent of political pressure, including pressure from President Trump. The senator highlighted several statements Dr. Shelton has made in the past that call into question her fitness for the role, such as her advocacy for a return to the gold standard, comments suggesting she disagrees with the basic purpose and mission of the Fed, and her suggestion that it would be appropriate for the Fed to coordinate more directly with Congress and the President.

"These comments raise serious questions about your understanding of the Fed's operations and your commitment to carrying out its mission," the senator wrote in her letter.

The senator also noted several instances in which Dr. Shelton shifted her stated views on economic policy to reflect President Trump's preferences, rather than base her views on evidence and sound economic analysis.

"These and many other statements you have made in your public career strongly suggest that you lack the capacity to exercise the care, consistency, and political independence expected of members of the Board of Governors by policymakers and the American public across the political spectrum," the senator continued.

In a series of questions, Senator Warren asked Dr. Shelton to clarify her past statements by February 13, 2020.

In April 2019, Senator Warren sent similar letters to Stephen Moore and Herman Cain, both of whom President Trump intended to nominate to the Fed before both withdrew their nominations.