Senate clears the way for Kevin Warsh to become Federal Reserve chair before Friday
The chamber approves the Trump nominee’s appointment as a member of the Board of Governors. The vote to confirm him is still pending
Kevin Warsh’s path to becoming chair of the Federal Reserve is full of obstacles. On Monday, he cleared another hurdle in the Senate’s complex procedural process. However, several steps remain before Warsh is officially appointed to replace Jerome Powell, whose term as chair ends on Friday.
The Senate, where the Republicans hold the majority, is preparing to clear all of them this same week, before May 15, so that Warsh can take the helm of the Fed just in time for Powell’s departure.
The process began five months ago when, at the end of January, U.S. President Donald Trump proposed Warsh as a candidate to head the central bank, known as the guardian of the U.S. dollar.
The Federal Reserve is an autonomous body, independent of the president. Its independence stems from the power granted to it by Congress, which must approve all its appointments. In other words, the president proposes candidates, but it is the Senate that must confirm them.
Within weeks of Trump’s announcement, the leaders of the Republican majority in the Senate submitted his nomination to the influential Banking Committee, the parliamentary body responsible for confirming the appointment. This committee has taken its time because the Republicans were unable to assemble a majority.
Conservatives hold a narrow 13-11 majority on this committee. And Republican Senator Thom Tillis of North Carolina warned that he would vote against any Trump nominee as long as the Justice Department continued its criminal investigation into Powell. The Justice Department opened an investigation into Powell’s testimony at a Senate hearing last summer regarding cost overruns on renovations to the Federal Reserve headquarters. But the investigation was widely seen to be part of the White House’s campaign to coerce Powell into resigning or complying with its demands to lower interest rates more aggressively.
So it wasn’t until a couple of weeks ago, on April 29, when the prosecution dropped the investigation into Powell, that Warsh managed to overcome the biggest hurdle: securing the approval of the Banking Committee. This came after a Senate confirmation hearing in which he failed to dispel doubts about his independence.
On Monday, he also managed to clear another procedural hurdle. The full Senate voted on a motion required to smooth his appointment as a member of the Board of Governors, replacing Stephen Miran, the man Trump placed at the Fed to try to influence interest‑rate cuts. In reality, what the Senate voted on was what is known as a cloture vote, a Senate mechanism that allows debate on an issue to be brought to an end so that a final vote can take place. Under Senate rules, it is used to prevent a minority from blocking a vote by prolonging debate indefinitely.
Following this favorable vote, the full Senate will vote on Tuesday on Warsh’s appointment as a member of the Federal Reserve’s Board of Governors for a 14‑year term. It will also hold another cloture vote on his selection as Fed chair (to prevent an endless debate). Finally, a confirmation vote for the chairmanship will likely take place on Wednesday, before the end of the week, when the handover between the two governors is scheduled to occur.
Powell’s term as chair ends this Friday, but he has announced that he will remain as a member of the Board of Governors, which he currently chairs, “for a period of time to be determined,” since that term runs until 2028. He explained that he will stay at the Fed until all doubts about his management have been cleared and prosecutors rule out reopening the case. “I plan to keep a low profile as a governor. There’s only ever one chair of the Federal Reserve Board. When Kevin Warsh is confirmed and sworn in, he will be that chair,” he said a couple of weeks ago.
The Fed’s Board of Governors is made up of seven governors appointed by Congress, plus another 12 governors representing the regional Federal Reserve Banks. Decisions on interest rates, however, are approved by the Federal Open Market Committee (FOMC), which consists of the seven Senate‑confirmed governors plus five of the 12 regional bank presidents, who are selected on a rotating basis.
Two more votes
Although Warsh has cleared the most difficult hurdle, several steps remain in the process and could extend it by a couple more days. Senators still have to vote on Warsh’s appointment as Fed chair, in a session that could take place on Tuesday. After that, the full Senate must hold a final confirmation vote, likely on Wednesday, once lawmakers reach an agreement.
He is not expected to face many obstacles. After Tillis withdrew his hold and Democrat John Fetterman, the senator from Pennsylvania, announced that he will support Warsh, the vote appears set to proceed smoothly.
It doesn’t appear that she’ll encounter many obstacles. Following Tillis’s withdrawal of her veto and the announcement by Democratic Senator John Fetterman of Pennsylvania that he will support Warsh, it seems the vote will proceed smoothly.
If confirmed, Warsh will be the wealthiest Fed chair in history. He has an estimated net worth of more than $100 million. He is also married to Jane Lauder, one of the heirs to the Estée Lauder cosmetics empire. As a result, before the series of votes began, Warsh had to meet with the Office of Government Ethics to disclose all his assets. Trump’s nominee has pledged to divest all holdings that could pose conflicts of interest within 90 days. His investments include cryptocurrencies, prediction platforms such as Polymarket, and stakes in SpaceX, Elon Musk’s company, which is expected to go public in a few weeks. He also holds investments in two funds valued at more than $50 million, though the exact amount was not specified.
His large fortune has triggered a wave of criticism and warnings about potential conflicts of interest. In fact, during his Senate confirmation hearing, Warsh had a heated exchange with Democratic Senator Elizabeth Warren over his wealth after the nominee cited confidentiality agreements to avoid disclosing the bulk of his investments. “ I agreed to divest virtually all of my financial assets, the large majority of which will be divested,” he said, but he failed to dispel doubts about his ties to billionaire financier Stanley Druckenmiller, for whom he worked before his career at the Fed.
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