Republicans Threaten to Use Yellen as Political Football
Policy + Politics

Republicans Threaten to Use Yellen as Political Football

REUTERS/Joshua Roberts

Senate Republicans, fresh from their party’s politically disastrous decision to shut down the government and bring the Treasury to the brink of default, are now threatening to block Janet Yellen’s nomination to lead the Federal Reserve. 

Yellen is poised to become the first woman to lead the central bank, making her the foremost player in the uphill effort to reenergize a flagging economic recovery. Financial markets reacted positively to her performance last week during Senate confirmation hearings and it is widely expected that her nomination will sail through the Senate Banking Committee on Thursday. 

Related: Yellen Shows She’s Ready to Lead the Fed 

Sen. Bob Corker announced yesterday that he would join four other Republicans in voting with Democrats to confirm President Obama’s nomination of Yellen. With five Republicans behind her and all 55 Senate Democrats expected to support her, Yellen at first glance has a filibuster-proof majority. 

But in the Senate, things aren’t always what they seem. 

Less than a month after Republicans in Congress rocked global markets by forcing a government shutdown and bringing the U.S. Treasury to the brink of default, two influential GOP lawmakers – Rand Paul of Kentucky and Lindsey Graham of South Carolina -- are threatening to block a vote on Yellen once her confirmation resolution reaches the floor.

A spokesperson for Senator Rand Paul of Kentucky said Paul “will do what he can to slow down the confirmation process, including demanding a 60-vote threshold for confirmation.” A spokesman for South Carolina Senator Lindsey Graham said that the senator has “absolutely” not ruled out an effort to put a hold on her nomination. 

The kicker: Graham is one of the five Republicans who, as of Wednesday night, had declared support for Yellen. 

Republicans have not been shy about voicing their displeasure with Yellen, whether on issues of policy or her qualification for the job. Senator David Vitter of Louisiana promised to vote against her, in part, for her unwillingness to address his concerns about the danger of banks considered “too big to fail.” Corker, though he eventually decided to support her, hit Yellen for her lack of experience as a banking regulator. 

Related: How Rand Paul Could Sink the Stock Market

Paul’s effort to slow the nomination is at least over an issue relevant to the Fed. The Kentuckian has long pushed for a bill to require the Fed to submit to an audit, claiming that the central bank’s lack of transparency – especially given the growth of its balance sheet in recent years – is dangerous. He won’t drop his objection to her nomination unless his proposal is brought up for a vote. 

But Senator Graham’s threat to block a vote on her candidacy has nothing to do with either Yellen or the Fed and everything to do with his ongoing battle with the State Department and the White House to force the State Department to let him interview the survivors of the terrorist attack on the U.S. Consulate compound in Benghazi. (For its part, the State Department has declined to let the survivors testify before Graham, arguing that it could prejudice later legal proceedings.) 

Graham’s objection is particularly striking because of his on-the-record support for Yellen. 

Graham told Bloomberg Tuesday that Yellen “seems to be a qualified lady” and that he is “inclined to support her.” But if he changed his mind the Democrats would, as of Wednesday night at least, be one vote shy of the sixty votes needed to end debate on her nomination. 

Graham may be able to gum up the works in the Senate for a time, but his ability to actually prevent a vote on Yellen is not clear. In years past, a Senator who placed a hold on a nominee could expect the Senate Majority Leader to honor it, thus preventing the nomination from being brought to the Senate floor. But experts in Senate procedure say that, given the hostility between the two parties in the Senate, such courtesies are a thing of the past. 

“He’s going to be rolled as far as blocking all the nominees from coming to the floor,” predicted Elizabeth Letchworth, former U.S. Senate Secretary for the Majority under Republican Majority Leader Bob Dole, and now a principal with Washington-based consultancy Congressional Global Strategy. 

Related: Yellen vs. the Fed Critics 

Jim Manley, a former top aide to current Democratic Majority Leader Harry Reid and now senior director with QGA Public Affairs, agreed that Reid is not likely to honor any hold requests. 

“In years past, a majority leader would usually have honored these so-called holds by not bringing the nomination up,” Manley said. “But not in this day and age.” 

If his hold is not honored, Senate rules will prevent Graham from stopping Yellen’s nomination from coming to the floor. At that point, his last opportunity to block the nomination would be by organizing a filibuster of the vote itself. 

Graham would undoubtedly have some influential supporters, such as Arizona Sen. John McCain, who joined Graham at a press conference on October 31 to threaten a filibuster of both Yellen and Jeh Johnson, President Obama’s pick to head the Department of Homeland Security. 

However, other senior Republicans, including Senate Banking Committee ranking member Richard Shelby, of Alabama, while opposed to Yellen, seem squeamish about a filibuster. 

“I don’t believe we have ever filibustered a Fed chairman,” Shelby told Reuters. "I don't think I would filibuster a Fed nominee unless something came up that was just horrible.” 

Graham’s spokesperson did not say what the senator would do if Yellen’s nomination comes to the floor, suggesting in an email that the senator is still holding out hope that he will reach some accommodation with the White House over his Benghazi request. “We hope it’s not necessary to hold the nomination,” the spokesperson said. 

Follow Rob Garver on Twitter @rrgarver 

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