With Jerome Powell's chairmanship due to expire on 15 May, Senator Thom Tillis has blocked the Senate Banking Committee from advancing Kevin Warsh's nomination to chair the Federal Reserve, citing an ongoing Justice Department criminal probe into Powell.
Senate stall leaves Powell in limbo
Senator Thom Tillis, a Republican from North Carolina and member of the Senate Banking Committee, said he won't support advancing Kevin Warsh's nomination to be chair of the Federal Reserve while a Justice Department criminal probe into Jerome Powell remains active. That single refusal is enough to prevent the nomination from clearing the committee, and it has left the Fed's leadership in doubt as Powell's appointed term as chair approaches its legal expiry on 15 May.
Powell's seat on the Fed's Board of Governors however runs until 2028. He has told reporters he wouldn't resign from the board while the investigation continues, pushing instead for "transparency and finality," and said he would serve as acting chair if the Senate had not confirmed a successor by mid-May.
Why Tillis is holding the line
Tillis's opposition centres on a Department of Justice criminal probe into statements Powell gave to Congress about the cost of renovating the Fed's headquarters. The DOJ has said the matter warrants investigation.
For Tillis, the unresolved criminal probe represents a barrier to Senate business on a matter as important as the central bank's leadership. His stance aligns with others in the Senate who have suggested it would be preferable for the investigation to reach some resolution before the confirmation process proceeds.
President's reaction and legal questions
President Donald Trump has publicly threatened to remove Jerome Powell if Powell doesn't vacate the chairmanship by 15 May.
On television this week Mr Trump said that if Powell "is not leaving on time" he would fire him, adding he had held back from doing so previously.
The legal basis for a presidential removal of a Fed governor is contested. Statute restricts presidential removal of Fed officials to instances of demonstrated misconduct.
Courts have generally required a high bar to allow removal on those grounds. The uncertain legal terrain raises the prospect of litigation if a forced ousting were attempted.
Kevin Warsh's path to confirmation
Mr Warsh, a former Fed governor, has a Senate confirmation hearing scheduled for next week. But with Tillis refusing to vote to advance the nomination, the committee lacks the votes to send Warsh's name to the full Senate. The blockage creates the possibility that, even if Mr Warsh is the president's preferred candidate, he may not receive a floor vote.
Senate Majority Leader John Thune, a Republican, said he thought it would be "better if [the probe] winds down" before moving on the nomination, making Warsh's confirmation uncertain.
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Powell has said he will remain on the Fed's board while the probe continues and would serve as acting chair if no successor is confirmed by 15 May.
This article was created with AI assistance.
