President-elect Joe Biden will work to reverse the decades-long trend that has seen workers claim an ever-decreasing share of the U.S. economic pie. A Bloomberg report asserts that no matter which political party ends up controlling the Senate, Biden likely will continue to work toward higher returns for labor and could look to a Republican for continued support: Federal Reserve Chairman Jerome Powell.
From a higher minimum wage and increased power for unions to bigger taxes on capital gains and the wealthy, Biden has outlined an ambitious agenda to lift labor's share of the income the economy generates.
“It's time to reward work, not just wealth, in America,” Biden told reporters after a Nov. 16 meeting with union and corporate leaders to discuss the coronavirus pandemic's effect on the economy.
The trouble for the president-elect is that much of his program hinges on whether Democrats take control of the Senate, something that won't be known until early January after run-off elections for Georgia's two seats. If the Democrats fall short – as many political analysts expect – Biden will have to largely fall back on executive and regulatory actions to try to tilt the playing field toward workers.
Current Fed chair Powell also has been committed to returning the labor market to better times when unemployment was at a 50-year low of 3.5% and a wide swath of workers were enjoying wage gains. And Powell overhauled the central bank's strategic framework to help bring that about.
That objective is also backed by Biden's reported pick for Treasury secretary, Janet Yellen, and it is likely to endure even if Powell isn't re-nominated for a second term when his current one ends in February 2022, Bloomberg says.
Bloomberg says that Biden's economic team likely will take a significant step this week toward addressing the damage to the U.S. economy inflicted by the coronavirus pandemic. In addition, Biden has called for trillions of dollars in new stimulus to aid the fundamentally important small and mid-size businesses.
As his future staff is filled out, he is expected to name longtime Democratic policy staffer Neera Tanden to lead his Office of Management and Budget and Cecilia Rouse to head the Council of Economic Advisers (CEA).
Tanden's nomination already appears to be in trouble with Senate Republican aides expressing opposition before it was formally announced. Drew Brandewie, an aide to Sen. John Cornyn, R-Texas, said on Twitter that she “stands zero chance of being confirmed.” Another aide said Republicans in the Senate would certainly block Tanden, who's viewed as too progressive even though she's also had squabbles with some on the left.
Biden's picks for his economic team suggest he will make it a “special priority” to lift the fortunes of Black and lower-income Americans whose gains in recent years have been endangered by the coronavirus pandemic.
As for Rouse, who is to be named the head of the CEA, Bloomberg says she would become the first Black American in the position. Jared Bernstein and Heather Boushey, two progressive economists who have argued for the Federal Reserve to target the Black unemployment rate and for increasing the minimum wage, are expected to join Rouse as members of the CEA.
However, not all the activity was from the president-elect. President Trump formally nominated Brian Brooks to take over a key banking regulatory position. In a brief Friday statement, the White House said it had sent the nomination to the Senate, where Senate Banking Committee Chairman Mike Crapo, R-Idaho, has already signaled that Brooks would get a confirmation hearing for a five-year term leading the Office of the Comptroller of the Currency. Brooks has been acting OCC chief since May.
Trump's highly unusual move to try to install an industry-friendly watchdog at the end of his administration has been blasted by Democratic lawmakers who argue the president is refusing to accept the results of this month's election.
If Crapo succeeds in fast-tracking Brook's confirmation, Biden would then have to decide whether to remove him after the Jan. 20 inauguration. While the law indicates Biden can oust Brooks, such authority has never been used before. Biden's acting Treasury Secretary could immediately remove Brooks if he fails to win Senate approval.
So, we will see. Clearly these are very high stakes decisions that will continue until the new administration is fully defined and can turn its attention to governing. These nominations will include a number of positions in USDA which have not yet been indicated, in spite of a good bit of interest and discussion — debates producers certainly will watch closely as they emerge, Washington Insider believes.