Lawmakers clash over Treasury candidate’s Soviet track record and anti-fuel stances

Fireworks erupted on the Senate Banking, Housing and Urban Affairs Committee on Thursday over President Biden’s candidate for a regulatory post in the Treasury Department, with Republicans questioning his worldview as a native of the Soviet Union and Democrats accusing Republicans of engaging in “Red Tactics of Fear.”

Willow Omarova, a Cornell University law professor appointed as Comptroller of the Currency, faces unified Republican opposition over past claims that she wanted the fossil fuel industry to go bankrupt to help fight the climate change and proposed blocking credit to “sub-optimal” industries such as arms dealers.

His appointment is on shaky ground. Two Democrats, Senator Mark R. Warner of Virginia and John Tester of Montana, have expressed concerns over Ms. Omarova’s past objections to bipartisan banking legislation. She would be the first woman and the first non-White to hold this position.

Louisiana Republican Senator John Kennedy asked Ms. Omarova if she had grown up in the Soviet Union and if she had ever resigned from a Communist youth organization. She was born in Kazakhstan and graduated from Moscow State University in 1989.

Mr Kennedy said at one point that Ms Omarova joined a Marxist Facebook group in 2019 “to discuss socialist and anti-capitalist views”.

“I don’t know if I should call you ‘teacher’ or ‘classmate,’ Mr. Kennedy told him.

“Senator, I am not a Communist,” replied Ms. Omarova. “I do not subscribe to this ideology. I couldn’t choose where I was born. I don’t remember joining a Facebook group that adheres to this ideology. I would never knowingly join such a group. There is no record of my participation in Marxist or Communist discussions of any kind. My family suffered under the communist regime.

Most Democrats back Ms. Omarova and say Republicans have launched an unfair campaign against her.

Senator Elizabeth Warren, Democrat of Massachusetts, told the candidate that the big banks and their Republican allies “declared war” on you.

“The attacks on your appointment have been vicious and personal,” Ms. Warren said. “Sexism, racism, pages straight out of Joe McCarthy’s 1950s Red Scare tactic. … Welcome to Washington in 2021.

Other Republicans have challenged Ms. Omarova’s past positions on the banking sector. They said she essentially called for banks to be used as leverage to force social change for left-wing initiatives. South Carolina Republican Senator Tim Scott criticized Omarova for her “disdain for the financial services industry.”

“I can’t think of a candidate more ill-suited to be the controller of the currency, ”he said.

Pennsylvania Republican Senator Patrick J. Toomey said Omarova’s academic writings called for a “dramatic expansion of central government power and control to allocate resources to banking supervision, and a corresponding decrease in American freedom. and institutions. “He called the candidate’s dossier a” socialist manifesto for American financial services. “

“The powers of the Comptroller of the Currency are enormous: the power to decide who opens a bank account, who does not; what types of loans can and cannot be offered, ”Mr. Toomey said. “The possibility of exercising a radical ideology through the powers of the Comptroller of the Currency is frightening.”

Republicans reminded Omarova of Operation Choke Point, an Obama-era Justice Department initiative that investigated banks doing business with gun dealers, payday lenders and other industries that the federal government has classified as high risk for fraud and money laundering.

The program ended in 2017, and Republicans have expressed concern that the Treasury candidate may attempt to revive the Justice Department’s initiative.

“I just have great concern. Do you believe the firearms industry is a socially suboptimal industry? Asked Senator Mike Crapo, Republican of Idaho.

Ms. Omarova replied: “Senator, I do not think much about the gun industries. I believe that if I am confirmed as Comptroller of the Currency my job will simply be to make sure that all national banks are safe and sound and that they take into account all risk factors when deciding to lend. to this or that company Company. ”She said any decision about the gun industry would not be up to her.

The audience turned heated when Mr. Kennedy asked about Ms. Omarova’s early years in the Soviet Union and asked if she was a member of the Young Communists.

“Senator, I was born and raised in the Soviet Union,” she said. “Everyone in this country was a member of Komsomol, which was the communist youth organization, because it was normal progress in school.

Mr. Kennedy asked if she had resigned from Komsomol. Ms. Omarova replied that membership automatically ends at a certain age. Senator Sherrod Brown, Democrat of Ohio and chairman of the committee, was angered when Mr. Kennedy asked for a letter of resignation.

“I’m not interrupting. I hardly ever cut them off, ”Brown told Kennedy.

“But you always interrupt me, Mr. President,” replied Mr. Kennedy.

As the two lawmakers clashed over Senate interruptions and protocol, Mr. Brown berated his fellow Republican, “Sen. Kennedy, senatorial courtesy doesn’t kill character either.

Mr. Kennedy replied, “Well, that’s your opinion, but I have the right to answer questions without you interrupting me. “

Mr Kennedy later said Ms Omarova can believe what she wants in the United States, but “we can’t just let just anyone be the controller of the currency.”

“In 2020, you wrote another article called” The Climate Case for a National Investment Authority “, where you said:” What we need to do for the oil and gas industry is bankrupt it by the federal government so that we can fight climate change, ”Kennedy told him.

When asked by Mr. Brown if she wanted to bankrupt the oil and gas companies, Ms. Omarova replied, “No, senator, I do not want to. It was bad wording.

Ms Omarova must now win the support of all moderate Democrats to advance her nomination to an equally divided Senate. At least a few of those lawmakers, including Senators Kyrsten Sinema of Arizona and Joe Manchin III of West Virginia, have not publicly pledged their support for the candidate.

Mr. Tester and Mr. Warner said they oppose Ms. Omarova’s opposition to the Economic Growth, Regulatory Streamlining and Consumer Protection Act, which they co-sponsored. The banking legislation was enacted in 2018. Mr. Warner called Ms. Omarova’s positions “quite disappointing”.

Correction: An earlier version of this article included an incorrect date for Ms. Omarova’s graduation from Moscow State University.

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