With each passing day, another plank of the infrastructure-reconciliation package seemingly comes under threat. International tax reporting standards have been eroded, means tests proposed, and drug pricing fixes tabled. It’s dispiriting, not to mention self-defeating. As so-called moderates sacrifice the party’s legislative agenda at the altar of corporate cash, many are wondering, can’t Biden do something to salvage his platform? The answer, obviously, is yes. And the most consequential of those potential actions likely don’t involve smashing congressional heads together. Biden has the power to make big changes right now without having to give a second thought to “centrist Democrats’” objections. With his approval ratings sliding and pessimism about the prospects for reforms rising, it would seem an opportune time to make that clear.
Unfortunately, as it stands, the Biden administration can hardly be said to be maximizing executive power to deliver for the public. As the American Prospect’s David Dayen recently pointed out on Twitter, their Executive Action Tracker has been stuck at 12 out of 77 potential actions for months. And, as my colleagues Timi Iwayemi and Fatou Ndiaye wrote in a piece out in the Prospect today, the administration is failing at one of the most essential tasks before it: transferring the technology for the COVID-19 vaccines to the rest of the world. That is despite the fact that they have multiple means by which to achieve this lifesaving task. Instead, they are shrinking from the fight with pharmaceutical giants and trying to pass off wholly inadequate vaccine charity as a worthy substitute. As our Jeff Hauser stated last week, “This behavior is cowardly and deadly. Every official responsible — and there are many with the power to act here — has blood on their hands.”
Personnel
Despite this stunning failure, there is reason for optimism that the Biden administration will expand its reliance on executive power in the near term. Its comfort with potentially controversial but tremendously impactful interpretations of existing law, for example, appears to be growing. Such an interpretation within the Centers for Medicare and Medicaid Services helped avoid a funding cliff for Puerto Rico’s Medicaid program and guarantee a much larger minimum funding level than in the past. Without this change, continued funding would have depended on action from Congress. If that unreliable route had failed, cuts to programs on the island would have ensued.
Several recent nominations also suggest that new, bold policies could be around the corner. Saule Omarova’s nomination to be the Comptroller of the Currency, in particular, stands out. As Jeff Hauser said last week, “Professor Omarova has spent over a decade fighting for the belief that the public should set rules for banks, rather than banks setting rules for the public. Omarova’s National Investment Authority proposal is exactly the kind of deeply-researched, bold policy rooted in a progressive vision of economic populism we want to see from leaders across the federal government.” Unfortunately, unless the Senate changes the rules that govern the confirmation process, it will likely be months before Omarova gets started.
Meanwhile, the Biden administration’s failure to nominate officials for many roles continues to weigh on its executive policy agenda. One such role, to lead the Office of Information and Regulatory Affairs (OIRA), has particularly wide-reaching implications. Rules from all but the independent agencies must undergo review at OIRA before they take effect. Traditionally, this process has slowed and watered them down (thanks to some mix of industry input and staff capture). Biden has proposed changes to address these problems, but without permanent leadership committed to change, the agency appears to be falling into old patterns that risk undermining Biden’s agenda.
Governance
Most people probably couldn’t tell you much about all of the legislation that is moving through Congress right now but, I would bet, most are aware that there’s a lot of it. Tucked into one of those many vehicles is a measure that we at Revolving Door Project are particularly excited about: the PLUM Act. Short for the Periodic Listing Updates to Management, the PLUM Act would direct the Office of Personnel Management to maintain a centralized database of senior government leaders that is updated monthly. This would replace the current system whereby OPM publishes this information every four years (yes, you read that right). In addition to increasing the frequency at which this information is updated, the PLUM Act would also expand what is reported to include demographic information so that we can better assess the federal government’s progress on diversity within its highest ranks.
Having sent dozens of Freedom of Information Act requests to get the information this database would provide, we have a selfish reason to be enthusiastic about this change. Setting that aside, however, it is clear that this is a long overdue step towards greater transparency. Knowing who is making key decisions is, after all, an essential prerequisite to holding them accountable. As it stands, that basic information is surprisingly opaque. The Trump years, during which even those who tracked agencies very closely couldn’t always keep track of who was making what decision amid an endless chain of delegations, were an extreme example. But the problem is not exclusive to Trump. We’ve highlighted how little we know, for example, about leadership at the Department of Justice under Biden. We’ve also complained when powerful, conflicted officials like Mark Gallogly are hidden from public view. It’s frankly shocking that this opacity is allowed; we’ll be happy for it to be a thing of the past.
Ethics:
It seems that each week brings a new example of a Trump administration official getting rich off their prior government “service.” This week, it’s the fact that Steven Mnuchin and his army of former Treasury officials, raised $2.5 billion, mostly from sovereign wealth funds in the Middle East, for his new private equity fund. We’ve long argued that Biden should take advantage of these ongoing, fabulous displays of corruption to underscore his administration’s superior commitments to ethical conduct. That strategy becomes harder, however, when senior appointees refuse outright to commit not to follow in Mnuchin and others’ paths. Last week, Senator Elizabeth Warren asked Treasury General Counsel nominee and serial revolver Neil MacBride to make that commitment. He refused.
The unfolding scandals at the Federal Reserve can’t be helping either. Earlier this month, it emerged that Federal Reserve regional bank presidents Eric Rosengren and Robert Kaplan had been trading securities that were directly impacted by the Federal Reserve’s emergency response programs at a time when they had access to nonpublic, material information about those programs. On Monday, Rosengren and Kaplan both announced their early retirements. Chair Jerome Powell has vowed to tighten ethics rules at the Fed but has not heeded calls to investigate these trades or other Fed leaders’ actions.
It is absolutely true that President Biden had no hand in appointing these officials, nor was he in office when the trades in question occurred. But he is currently facing a decision over whether to reappoint Powell, who is centrally implicated in the scandal (Fed attorneys report to him, and Powell and fellow Trump appointees Quarles and Clarida are disquietingly active traders) and the lackluster response to it (Powell praised the disgraced bankers on their way out the door while refusing to make referrals to the SEC and DOJ).
After this latest vindication for our view that a private equity past predicts public service performance, Powell lacks the credibility to lead an ethical review, impose new standards, ensure strong enforcement, and evaluate replacements for the retiring Bank presidents. If Biden wants to signal that he takes these sorts of violations of public trust seriously, he should look to someone new as Chair.
Want more? Check out some of the pieces that we have published or contributed research or thoughts to in the last week:
FERC Nominee Willie Phillips Has a Pro–Corporate Utility Record
Biden Administration's Inaction on Vaccine Equity is Cowardly and Shameful
Maria Robinson Must Not Promote Methane Gas At DOE
Omarova Appointment Brings Expertise And Independence To Comptroller Role
The Other Ethics Issues At The Fed Regional Banks
Powell vows to tighten Fed ethics rules after stock trading uproar
Fed resignations don't blunt calls for broader ethics changes
2 top Fed officials retire in wake of trading disclosures
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