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Republican cautions against blocking Yellen's Fed nomination

Janet Yellen (L), nominee to be the next chairperson of the U.S. Federal Reserve, sits down to a meeting with Senate Banking Committee membe
Janet Yellen (L), nominee to be the next chairperson of the U.S. Federal Reserve, sits down to a meeting with Senate Banking Committee membe

WASHINGTON (Reuters) - A senior Republican on the Senate Banking Committee said on Thursday he would oppose efforts to block the nomination of Janet Yellen as Federal Reserve chairwoman with a filibuster unless some disturbing disclosure emerged.

"I don't think I would filibuster a Fed nominee unless something came up that was just horrible," Alabama Senator Richard Shelby told Reuters Insider. "But that doesn't mean I won't speak against them, vote against them, work against them."

Shelby's sentiments are important because Democrats would need to pick up only five Republican votes to clear procedural hurdles to bring Yellen's nomination to a vote in the Senate where confirmation needs only a simple majority.

Democrats control the chamber 55 to 45.

"I don't believe we have ever filibustered a Fed chairman," Shelby said shortly after meeting with Yellen for about 40 minutes. "That job is so, so important. That doesn't mean I haven't voted against some. I have. I have supported some too."

Shelby's views are not shared by all Republicans.

Senator Rand Paul of Kentucky has said he intends to place a "hold" on Yellen's nomination unless the Senate leadership allows for a vote on legislation he has sponsored that would open the Fed's monetary policy decisions to congressional audit.

Senator Lindsey Graham has also vowed an effort to block White House nominees unless the Obama administration comes forward with more information about the 2012 attack on U.S. diplomats in Benghazi, Libya.

Democrats are confident they will be able to round up the votes needed to prevent any attempt to obstruct a vote on Yellen's nomination. President Barack Obama tapped Yellen, currently the central bank's vice chairwoman, to succeed Fed Chairman Ben Bernanke when his term expires on January 31.

Although Shelby said Yellen should face an up-or-down vote, he made clear he had concerns about her nomination, although he said it was too early to say how he would vote.

"I have some concerns about the nominee," he said. "Also, I have a lot of concerns about the role of the Fed ... the portfolio of the Fed."

Many Republicans worry the central bank is courting sharply higher inflation and planting the seeds for asset bubbles with its aggressive easing of monetary policy. The Fed cut interest rates to near zero in 2008 and has roughly quadrupled its balance sheet to $3.80 trillion through a series of bond purchase programs.

"Will this go on forever? When will it end? What will be the repercussions? There are a lot of serious complex questions here," said Shelby, who voted against Yellen's nomination as vice chairwoman in 2010.

He said he planned to explore those issues in detail when Yellen comes before the banking panel for a hearing.

The committee, which vets the nomination before it goes to the Senate, is considering holding a hearing on November 14.

(Reporting by Thomas Ferraro; Writing by Tim Ahmann and Kenneth Barry)

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