Fed Goes Green As Oil And Inflation SpikeAs America's economy teeters on the brink, its central bank is being handed over to a cadre of progressive activists.
By Kevin Stocklin
March 15, 2022
Two of the most critical issues facing Americans today—energy production and inflation—have added high stakes drama to what is normally a routine and arcane process: the Senate confirmation of the leadership of the Federal Reserve, our central bank.
Charged with controlling inflation and fostering employment, the Fed has recently taken steps to expand into new arenas: fighting climate change and promoting social justice. The Senate confirmation process has come to a head over Biden nominee Sarah Bloom Raskin, who GOP senators say is too radical in her antipathy toward oil producers to serve as the Fed’s chief bank regulator. Meanwhile, legal analysts say the Fed is stepping outside of its mandate in pursuing political causes.
Climate change activists look longingly at the Bank of England and the European Central Bank (ECB), which have explicit mandates to support a transition to green energy, as models for America’s banking system. European central banks enact an environmental agenda through mechanisms such as “Green Quantitative Easing,” using taxpayer funds to finance green companies and projects. In addition, there has been a push for central banks to leverage their supervisory control over private banks and to penalize them for lending to so-called “brown” companies—oil and gas producers—with additional “green capital requirements,” which make such loans more expensive for banks to issue.
Raskin criticized America’s regulators in September 2021 for not “thinking creatively” about how to combat climate change the way other central banks have done: “Their reluctance stands in stark contrast to financial regulators in other rich countries, where policies and processes are being reimagined to accelerate a rapid, orderly and just transition to a renewable, biodiverse, and sustainable economy.”
The Fed, Raskin argued, must use its powers to incentivize a “transition away from high-emission and biodiversity-destroying investments.” For this and other reasons, Republican Senators have thus far refused to confirm Raskin. In addition, 24 state treasurers and financial officers have formed a coalition to oppose Raskin’s confirmation for her support of social causes over economic issues.
“Ms. Raskin’s repeated and forceful advocacy for having the Federal Reserve allocate capital and choke off credit to disfavored industries is alone disqualifying,” said Pat Toomey, the top Republican on the Senate Banking Committee.
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Source:
https://www.theamericanconservative.com/articles/fed-goes-green-as-oil-and-inflation-spike/
