Senate refuses to advance Fed nominee Shelton, in setback for Trump

The Senate on Tuesday voted to reject a move to advance President Donald Trump’s nomination of Judy Shelton to the Federal Reserve Board, thanks to the absence of key GOP lawmakers and opposition from others.

Shelton’s year-and-a-half-long candidacy faced skepticism from both sides of the aisle over her support for tying the value of the dollar to gold and remarks downplaying the importance of the Fed’s political independence, a cornerstone principle of the central bank since its founding.

Today's move was a stunning setback for Trump, who nominated Shelton and has seen several of his other picks for the central bank — including economics commentator Stephen Moore and the late Herman Cain — rebuffed by lawmakers, including those in his own party. Trump spent much of his term blasting the Fed and the chair he appointed, Jerome Powell, for not doing enough to boost the economy.

Republican Sens. Mitt Romney of Utah and Susan Collins of Maine voted against Shelton's nomination, in addition to all Democrats, while Sen. Lamar Alexander of Tennessee opposed her but was absent.

Senate Majority Leader Mitch McConnell also voted no to preserve his ability to try again to advance her. Republican senators said afterward that they hoped she would come up for another vote.

There were 47 votes in favor of advancing the nomination and 50 opposed.

Vice President-elect Kamala Harris was able to arrive at the Capitol in time to imperil Shelton’s confirmation. With Democrat Mark Kelly set to replace Arizona Republican Martha McSally after Thanksgiving, Shelton would be unlikely to get approval after this week.

The balance of votes tilted toward Democrats after Sen. Chuck Grassley (R-Iowa) announced Tuesday morning that he would quarantine after coming in contact with someone who had tested positive for Covid-19. Sen. Rick Scott (R-Fla.) is also in quarantine.

Although Shelton seemed poised for confirmation before Grassley’s absence, she almost didn’t make it out of committee. Sens. Pat Toomey (Pa.), Richard Shelby (Ala.) and John Kennedy (La.) all expressed skepticism about her after the confirmation hearing in February, though they ultimately decided to vote for her.

For their part, Democrats blasted Shelton for what they said was a politically convenient shift in her policy views that more closely aligned her with Trump. An advocate of a strong and stable dollar, she had slammed low interest rates for years. But after Trump started considering her for a post at the central bank, she supported his call for slashing interest rates to zero, even before the pandemic.