Business & Economy

On The Money: Trump’s controversial Fed nominee stalled | Economists warn of lag time between vaccine and recovery | Business group calls for national mask mandate, COVID-19 relief

Happy Tuesday and welcome back to On The Money, a Fleet-free zone. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL—Trump’s controversial Fed nominee stalled after Senate setback: Judy Shelton’s Federal Reserve Board nomination failed to advance on Tuesday after coronavirus-related quarantines sidelined some Republican senators and Vice President-elect Kamala Harris returned to the upper chamber to provide a crucial “no” vote.

  • Senators voted 47-50 to end debate on Shelton’s nomination, falling short of the simple majority needed. In a boon to Democrats, Harris, a Democratic senator from California, voted against Shelton’s nomination, preventing a tie.
  • Senate Majority Leader Mitch McConnell (R-Ky.) initially voted “yes” but with Shelton stuck at 48-49, he switched his vote, making the final tally 47-50. The move allows him to bring the nomination back up, something he immediately laid the groundwork to do.

What went wrong for Shelton: The setback comes only days after President Trump’s controversial pick appeared to be on a glide path to be confirmed to the Fed when Sen. Lisa Murkowski (R-Alaska) said she would support her. But two Republicans — Sens. Chuck Grassley (Iowa) and Rick Scott (Fla.) — were quarantined due to exposure to the coronavirus, throwing a late curveball into the Senate’s consideration of her nomination.

The Hill’s Jordain Carney and I tell you more here.

What comes next: Shelton’s nomination isn’t officially doomed, but the narrow window left to confirm her may have closed. 

  • To confirm Shelton before Thanksgiving, the Senate would likely need to hold a vote before Sen.-elect Mark Kelly (D-Ariz.) replaces Sen. Martha McSally (R) on Nov. 30 with both Grassley and Scott back to vote in her favor.
  • But Grassley on Tuesday evening announced he tested positive for coronavirus, making his return to the Senate before Thanksgiving highly unlikely.

If the Senate tries to confirm Shelton after Kelly is sworn in, Shelton would need either Kelly to break from all of his new colleagues and vote in favor, or for one of the three Republican senators already opposed to her to change their minds.

LEADING THE DAY

Economists warn of lag time between vaccine and recovery: The U.S. economy could take several more months to benefit from the emergence of successful coronavirus vaccines, putting a renewed focus on the winter as the country faces an unprecedented surge of COVID-19.

Preliminary results from two highly effective vaccine candidates are boosting hopes of a quicker end to the pandemic and a faster recovery from its economic damage. 

But while the light at the end of the tunnel may seem brighter today than it was 10 days ago, economists fear the U.S. still has daunting obstacles in its path.

  • Coronavirus cases and hospitalizations are shattering state records across the country.
  • As cases climb, unemployed workers and struggling businesses may run out of ways to stay afloat between now and widespread distribution of a vaccine. 
  • Several crucial government aid programs are also set to expire at the end of December, setting up a potential flood of foreclosures, evictions and bankruptcies.

Economists warn that if the White House and Congress are unable to bridge that gap with further aid, millions of Americans could suffer before the pandemic and economy turn around.

“If they don’t do much more, then we could be looking at a lot more businesses going under, the recovery backtracking and heading in reverse, and a bigger economic hole to dig our way out of,” said Adam Ozimek, chief economist at Upwork.

I explain why here.

Business group calls for national mask mandate, COVID-19 relief: The Business Roundtable, a group of CEOs from major U.S. companies, is calling for a slew of immediate government actions to address the rapidly growing COVID-19 pandemic and its economic consequences, including a national mask mandate and action on a relief bill.

“It’s not as though it’s either safety or economic recovery. There is no economic recovery without safety,” the group’s president, Joshua Bolten, told reporters on Tuesday.

In addition to a national mask mandate, Bolten said the government needs to issue clear safety guidelines for businesses, implement a national testing strategy and reengage with the World Health Organization.

The Hill’s Niv Elis has more here.

GOOD TO KNOW

  • President Trump on Tuesday announced his intention to nominate Acting Comptroller of the Currency Brian Brooks to a full five-year term leading the federal bank regulator.
  • Roger Ferguson Jr., president and CEO of asset manager TIAA, announced Tuesday that he will retire at the end of March amid speculation that he could be chosen to serve in the Biden administration.
  • The IRS is expected to resume knocking on the doors of high-income people suspected of avoiding taxes after the coronavirus pandemic is over, Bloomberg News reported.
  • Home Depot sales surged in the third quarter as Americans are spending more on home improvement as they remain home amid the coronavirus pandemic, the company reported Tuesday.
  • Stocks dropped Tuesday following retail sales figures that came in below expectations, signaling weakness in the economic recovery.

ODDS AND ENDS

  • Facebook’s Mark Zuckerberg and Twitter’s Jack Dorsey returned virtually to Capitol Hill Tuesday for another round of questioning that did more to highlight the gulf between Republicans and Democrats on proper content moderation than reveal any new information.
  • The House on Tuesday unanimously passed bipartisan legislation appropriating $750 million towards building out U.S. fifth generation, or 5G, network technology as a way to combat potential threats from foreign-made equipment. 
Tags Chuck Grassley Donald Trump Lisa Murkowski Mark Kelly Mark Zuckerberg Martha McSally Mitch McConnell

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