Tillis says he'll back Warsh if DOJ drops Powell probe

Senator Thom Tillis is making waves in Washington with a clear message: he'll back Kevin Warsh's nomination to lead the Federal Reserve, but only if the Justice Department calls off its investigation into current Chair Jerome Powell. The probe, focused on cost overruns tied to a new Fed facility, has become a political flashpoint. Tillis argues that ending it would help depoliticize the central bank and clear the way for Warsh's confirmation.

During Warsh's Senate hearing, Tillis praised the nominee's economic views, calling them sound and market-friendly. But he made it clear his vote hinges on the Powell investigation being dropped. The North Carolina Republican framed the issue as one of institutional integrity, saying the Fed should operate free from what he described as politically motivated scrutiny.

Warsh, a former Fed governor and close ally of Trump, faced tough questions about his independence. He repeatedly stated his commitment to keeping politics out of monetary policy. But when pressed by Senator Elizabeth Warren on whether Donald Trump lost the 2020 election, Warsh declined to answer directly, drawing criticism from Democrats who see him as too aligned with the president.

Still, Warsh pushed back against claims of loyalty over principle. In testimony to the Senate, he said Trump never asked him to promise specific interest rate moves, a key concern given the president's history of pressuring the Fed to cut rates. That line of defense resonated with some Republicans, who view Warsh as a steady hand with deep central banking experience.

The hearing unfolded alongside broader GOP efforts to reshape the narrative around Trump's past. On the same day, Trump praised Senator Rick Scott's resolution to expunge his 2019 impeachment, calling it a step toward fairness. That move, while symbolic, underscores a party-wide effort to solidify Trump's legacy and influence key appointments like the Fed chairmanship.

Progressives remain skeptical. Critics like Warren argue that Warsh's refusal to acknowledge the 2020 election outcome undermines his credibility. They worry that confirming him could erode the Fed's nonpartisan reputation, especially if the Powell probe is dropped for political reasons.

With the Senate closely divided, Tillis's stance could be decisive. His demand puts pressure not just on Warsh, but on the Justice Department and the White House. How this unfolds may say as much about the balance of power in Washington as it does about who leads the nation's central bank.