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  /  News   /  : ‘A socialist manifesto for American financial services’: Republicans blast Biden’s bank-regulator pick Omarova at fiery hearing

: ‘A socialist manifesto for American financial services’: Republicans blast Biden’s bank-regulator pick Omarova at fiery hearing

Senate Republicans came out swinging against President Joe Biden’s nominee to head the regulator of federally chartered banks during a confirmation hearing Thursday.

Biden nominated Saule Omarova to the role of Comptroller of the Currency, a regulator housed in the Treasury Department that oversees some of the nation’s largest banks, including Goldman Sachs Group Inc.
GS,
-0.13%
,
Wells Fargo & Co.
WFC,
-0.31%

and Bank of America Corp.
BAC,
-0.26%

“Taken in their totality, her ideas amount to a socialist manifesto for American financial services,” said Sen. Pat Toomey of Pennsylvania, the ranking Republican on the Senate Banking Committee. “She wants to nationalize the banking system, put in place price controls, create a command-and-control economy where the government allocates resources explicitly.”

Toomey was referring to a paper Omarova published last year in which she speculated on the possibility of the Federal Reserve offering retail banking accounts to Americans and having those accounts ” fully replace—rather than compete with—private bank deposits.”

Toomey and other Republicans interpreted the article as Omarova advocating for a complete public takeover of the retail banking system. She argued that the paper was merely an academic exercise that aimed to understand the implications of the emergence of both private digital currencies like Diem, a stablecoin initially proposed by Facebook, and public digital currencies like a Fed-issued digital dollar.

“This paper was written in the context of an ongoing academic debate on how to approach digitizing the dollar, because this seems to be inevitable,” she said.

Several Democrats also expressed some reservations about Omarova’s past statements, including Montana Democrat Sen. Jon Tester.

“I have significant concerns about positions that you have taken…related to our financial system bank regulations,” Tester said, pointing to her criticism of a 2018 law that loosened regulations on financial firms with between $50 billion and $250 billion in assets.

Tester is one of seven Democrats whom Politico reported Thursday have “reservations” about her nomination. Others banking committee members Sen. Mark Warner of Virginia, Sen. Kyrsten Sinema of Arizona, and Sen. Raphael Warnock of Virginia.

In a Senate split 50-50 between Democrats and Republicans, Omarova would need unanimous support of Senate Democrats to be confirmed.

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