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Trump's Pick for Fed Chairman Appears in Nomination Hearing; Nomination Hearing for Trump's Pick as Fed Chairman; Warsh Says, This is a Time of Great Consequence for Economy. Aired 10-10:30a ET

Aired April 21, 2026 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

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PAMELA BROWN, CNN ANCHOR: Happening now, breaking news, critical hearing. In moments, President Trump's pick to lead the Federal Reserve will face senators on Capitol Hill as questions swirl about the Fed's independence. Of course, we'll bring that to you live.

Plus, Trump's new threats, the president now says he, quote, expects to be bombing if the U.S. and Iran don't reach a deal by tomorrow's ceasefire deadline, which Trump claims is tomorrow night, as the U.S continues its blockade of Iranian ports.

And later reckoning and Congress, after the resignations of Eric Swalwell and Tony Gonzales, there are growing calls on Capitol Hill to reform the reporting process for misconduct allegations.

WOLF BLITZER, CNN ANCHOR: And one-on-one with, Senator Cory Booker. We will speak to the key Foreign Relations Committee member about fluid and very uncertain negotiations between the U.S. and Iran.

Plus, fleeing for their lives, terrifying video showing tourists running as a gunman opens fire at a pyramid tourist site in Mexico, killing one person and injuring several others.

And later, allegations of price fixing. California's attorney general is now investigating claims that Amazon is artificially driving up prices for Americans, accusations the massive online retailer denies.

Welcome to our viewers here in the United States and around the world. I'm Wolf Blitzer with Pamela Brown, and you're in The Situation Room.

The breaking news up on Capitol Hill, a confirmation hearing is about to begin for one of the most powerful jobs in the world's economy. At any moment now, Kevin Warsh will address the Senate Banking Committee as it considers his nomination to become the next chairman of the Federal Reserve.

BROWN: Lawmakers, especially Democrats, will want to know if Warsh can remain independent from President Trump and his pressure. That independence is considered essential for the credibility of U.S. monetary policy. Outgoing Chair Jerome Powell has fought off relentless attacks from President Trump who has consistently demanded that Powell lower interest rates.

BLITZER: We're covering both the political and the economic importance of this very high-stakes hearing.

CNN White House Correspondent Alayna Treene's over at the White House joining us. But let's go to -- let's begin our coverage this hour with David Goldman, our chief business reporter who's watching all of this.

Before I get to you, David, I want you to listen to what President Trump just said this morning about his nominee to lead the Federal Reserve. Listen to this.

(BEGIN VIDEO CLIP)

DONALD TRUMP, U.S. PRESIDENT: It looks like it's about $3.1 billion. It went up a little bit or a lot. So, the 2.7 is now 3.1.

JEROME POWELL, CHAIRMAN, FEDERAL RESERVE: I'm not aware of that.

You just added in the third buildings with it.

TRUMP: I want Kevin. I think Kevin's great. He is really -- he's central casting in a true sense, okay? I think he's going to do a great job. Yes, if there's time. I've been in favor interest rates. Rate rises to stop inflation. I think it sort of is effective.

(END VIDEO CLIP)

BLITZER: So, David, why does the president believe Kevin Warsh is the right choice to chair the Fed?

DAVID GOLDMAN, CNN BUSINESS SENIOR REPORTER: Well, Kevin Warsh is qualified to lead the Fed. He was at the Fed for about five years earlier in the last decade, and he oversaw you know, some of the big bailouts that the government gave during the financial crisis. So, certainly, that is the case.

What's unusual though is that Kevin is a lifelong inflation hawk. Now, that means that he prefers higher rates to combat inflation versus lower rates to promote job growth. That's curious because President Trump, as you heard, really wants lower rates. So, Kevin Warsh has changed his tune on this lately, and he has said that he actually now prefers lower interest rates. And so that certainly has made the president happy and convinced that he was the right pick.

BROWN: All right. Alayna, I want to bring you in from the White House. Kevin Warsh will, of course, address the issue of independence and his prepared remarks that he'll deliver.

[10:05:00]

This is what we received from Politico. He says, quote, I do not believe the operational independence of monetary policy is particularly threatened when elected officials, presidents, senators, or members of the house state their views on interest rates.

And now opening statements have begun. Let's go to the chairman, Tim Scott, and listen in.

SEN. TIM SCOTT (R-SC): -- the American's ability to buy groceries, whether or not they can afford a home, how far their paycheck goes, especially at the end of the month. And in South Carolina, I hear all the time how families are working hard, doing everything right and still feeling squeezed.

Bidenomics made prices go up and paychecks have not kept pace. Too many parents are stretching every single dollar they have just to cover the basics, and too many workers are wondering when the economy will start to feel stronger at their kitchen table, not just on paper. Congress, President Trump and his administration are focusing on fixing the disastrous mistakes of Bidenomics to restore Americans' confidence in our economy.

Through efforts like the Working Families Tax Cut Bill, we are helping Americans keep more of their hard earned money. Compared to the average tax return under President Biden over four years, the average return is up 24 percent since then. Just in the last year, the average tax return is now around $3,400 and 11 percent increase because President Trump and his leadership decided to focus on hardworking Americans who are struggling to make ends meet paycheck to paycheck.

Nearly half the country, half the returns filed in 2026 claimed either deduction for tipped income, overtime earnings, senior citizens or auto loan interest for major parts of the working family's tax cut bill that every single person on this dais to the right voted for.

Under President Trump's leadership, Americans are keeping more of their hard earned money, about $300 more every month. It is necessary that Congress continues to put money back in the hands of everyday Americans, and that is why it is important. And I want to be clear here, that is why it is important that we confirm Kevin Warsh to be the Federal Reserve chair.

The Federal Reserve has a clear dual mandate to promote stable prices and maximum employment. The policies of the Fed therefore directly affect Americans' cost of living and their income. And when the Fed is successful in fulfilling its dual mandate, affordability improves with Americans taking home more money and paying less for everyday necessities.

Unfortunately, in recent years, the Fed has faced real challenges. There have been questions about its decisions, its focus, and whether it has engaged in issues far outside its jurisdiction. Under the Biden administration, the Federal Reserve appeared to move with the political wins, raising real concerns about politics and weaponizing one of the most powerful weapons we have for good economically, the entire Federal Reserve system.

For example, under the Biden administration, the Fed pushed climate- focused initiatives only to reverse that climate agenda as soon as President Trump took office. When actions appear to shift with changing political priorities, it can undermine confidence in the independence of this great institution.

An independent Federal Reserve is essential to achieving its mission. Markets depend on it. Families depend on it. And that independence must be protected. The American people expect the Federal Reserve to stay focused on the economy, not politics.

Today's hearing is an opportunity to refocus the Federal Reserve on its dual mandate to increase economic stability and affordability for everyday Americans.

Kevin Warsh is battle-tested and brings a necessary experience from his time as a Federal Reserve governor during the Great Recession. During his first term as governor, he helped our economy through the crisis and restored faith in the economy.

[10:10:05]

He has seen the economy in its darkest days and understands how economic decisions affect job growth, our economy, and the opportunities that we have come to love as Americans.

We want every citizen in this country to have a chance to live their version of the American dream. And that means having our private sector economy running as strong as possible, which means your focus has to be on everyday Americans and not politicians, not the political winds, but on everyday Americans who desperately want to restore their confidence in our institutions.

Today, this committee will examine the plans Mr. Warsh has for his return to the Fed this time as chair, and how he plans to lead the institution at a critical moment to deliver lower cost and real relief for working families. For folks back home in the great state of South Carolina and across the country, the goal is simple. They want lower cost and more opportunities.

The Federal Reserve plays a key role in bringing prices down and helping wages go up. Confirming Kevin Warsh will make sure that affordability is at the center of our economic agenda.

Senator Warren is now recognized.

SEN. ELIZABETH WARREN (D-MA): Thank you, Mr. Chairman.

And if I may, I just want to start by saying one of our members lost a child yesterday. And I know our hearts go out to Mark Warner and his family, and that that is true on both sides of the aisle, that we may disagree on policies and we may do so vigorously, but when it comes to the safety and security and the health of our families, I know we are as one and we are praying for them.

SCOTT: Ranking member, I think it'd be appropriate for us to take a few seconds of silence on his behalf, 36 years old, the one thing you don't want to do as a parent,

Thank you.

WARREN: Thank you, thank you, Mr. Chairman, and appreciate all you do.

SCOTT: Okay.

WARREN: So, we should not be having this hearing today, and here's the context. First, over the past year, President Trump has racked up one economic failure after another, and Americans know that. Consumer sentiment just hit its lowest level on record ever. Inflation is rising and families are paying, more for groceries, more for healthcare, more for utilities, more for housing, all thanks to Trump's chaotic tariffs and one big, beautiful bill. And now his war with Iran is putting American troops in harm's way and further driving up the cost of nearly everything here at home.

Second, in your testimony, you said it's perfectly fine for elected officials to state their views on interest rates, but that is not what Donald Trump is doing. The president has repeatedly and illegally attempted to take over the Fed. His bogus attacks on Governor Lisa Cook and Chair Powell were designed to threaten all the members of the Fed to do Trump's bidding and open more spots for Trump flunkies.

Why try to end the independence of the Fed? Because Trump's economic failures are causing him political problems, and he wants the Fed to use monetary policies to artificially juice the economy in the short- term, and this is his last chance to do that before the November elections.

Having a sock puppet in charge of the Fed would also give the president access to the Fed's powerful authorities to enrich himself, his family and his Wall Street buddies. It could mean granting special accounts to his family's crypto company or bailouts to his friends on Wall Street if they get into trouble. In other words, a Fed under Donald Trump's control creates more opportunities for Trump's corruption.

Third, the nominee before us today, Kevin Warsh, is uniquely ill- suited for the job as Fed chair. In our meeting last week, we discussed the 2008 financial crash where 8 million people lost their jobs, 10 million people lost their homes and millions more lost their life savings.

[10:15:07]

Giant banks, however, got hundreds of billions of dollars in bailouts. Mr. Warsh was a Fed governor from 2006 to 2011. That's before, during, and after the crash. And he said to me that he has no regrets about anything he did.

So, let's take a deeper dive into Mr. Warsh's record. In the years leading up to the 2008 financial crisis, he was an enthusiastic cheerleader for credit default swaps and complex securitizations. He dismissed, repeated, and increasingly urgent concerns from housing advocates across the country regarding subprime mortgages. He refused to use the Fed's authorities to address the risks that were building in the financial system.

And when the crisis hit and the economy blew, Warsh took on the job of Wall Street's personal liaison on the Fed board. He was quick to respond to concerns from Wall Street CEOs and he worked tirelessly to arrange multi-billion dollar bailouts for them with nothing for American families. No regrets, he says No regrets.

After the crash, most people on the Fed saw millions of Americans, unemployed people who had lost their homes and said, now might be a good time to lower rates and make the cost of borrowing cheaper for businesses to avoid more layoffs and make it cheaper for Americans who are worried about paying their mortgages or their credit cards. But not Mr. Warsh, nope. He wanted to keep interest rates high. And he sang the same song for more than a decade, even as the economy struggled.

When the job of Fed chair became available during Trump's first term as president, Warsh held on to his high interest rate inflation hawk views, and Trump passed him by. Regretful, he soon reversed course and called for the Fed to pause interest rate hikes. Then once Trump left office, Mr. Warsh flipped again and was even criticizing the Fed for cutting rates in the fall of 2024. But as soon as Donald Trump became president a second time, Warsh reversed himself once more and began shouting from the rooftops about how the Fed should cut interest rates. Evidently, he learned his lesson. This time around, he sucked up to Donald Trump to snag his dream job.

Mr. Chairman, last week, every single Democratic member of this committee asks that you postpone this hearing and instead conduct oversight on the president's role in directing bogus criminal probes into Chair Powell and Governor Cook. The Senate should not be aiding and abetting Donald Trump's illegal takeover of the Fed by installing his chosen sock puppet as chair. It's an invitation for corruption and for economic catastrophe. We have the power to stop it and we should be using that power.

Thank you, Mr. Chairman.

SCOTT: Well, there you have it. I'll just say it. It is interesting that we're going to hear from Senator Dave McCormick and his introduction of Kevin Warsh was last time unanimously confirmed by the United States Senate, unanimously confirmed by the U.S. Senate.

Dave, the floor is yours.

SEN. DAVE MCCORMICK (R-PA): Thank you, Mr. Chairman, Ranking Member Warren, distinguished colleagues. It's really a great honor to introduce my friend, Kevin Warsh, and welcome him and Jane here today. Kevin has been a friend for many years.

Winston Churchill observed that for great leaders, there comes, and I quote, a special moment where they are figuratively tapped on the shoulder and offered the chance to do a very special thing. What a tragedy, he warned, if that moment finds them unprepared for that, which would have been their finest hour.

Colleagues, I'm here today to assure you, as someone who knows Kevin and who knows this institution, that Kevin Warsh could not be more prepared for this, his finest hour. There's no one more fitting, no one more fitting, no one more qualified to face this consequential moment as the 17th chair of the Federal Reserve.

[10:20:09]

Now, I'm not going to belabor Kevin's academic and professional record. They speak for themselves. Instead, I'd like to tell you about a man who Dina and I worked with decades ago and who has been someone I've called a friend for almost 30 years.

President George W. Bush famously appointed Kevin to the Federal Reserve in 2006 when Kevin was just 35. He was the youngest appointed board member in history. But President Bush saw in Kevin what I believe you will see in him with your questions today, wisdom that belied his age now deepened by experience, a moral clarity, even in the most turbulent of times, a sharp and independent intellect further strengthened by decades immersed in unforgiving global financial markets, and a deep, deep, honest understanding of how the decisions made in the marble hallways of Washington affect the lives of hardworking Americans.

Now, I, unlike many on this committee, have seen these virtues on display across decades of friendship. I first met Kevin in the late 1990s when he and my younger brother were junior associates on Wall Street. And a decade later, we served together in the crucible of the global financial crisis, I as the undersecretary of Treasury for International Affairs and Kevin on the Fed Board. For nearly two years, we worked hand in hand to contain the damage and navigate the country through the crisis. And I know that then Chairman Ben Bernanke relied heavily on Kevin during those turbulent times, and I did too. And I've continued to seek his counsel regularly in the years since.

Now, Kevin came to Washington all those years ago as an outsider, an idealistic young man determined to serve his country, one who has succeeded beyond all expectations. And he returns today is the ideal candidate to lead the Fed at this most crucial juncture. If confirmed, Kevin will inherit a Federal Reserve in need of repair and confronting serious uncertainty, an overextended balance sheet, a poor record on inflation, and a weak understanding of the profound opportunities offered in today's economy.

He's uniquely suited to confront these challenges. He brings a reformer's heart. He will shake up a stagnant institution at a time when change is sorely needed. He possesses a deep understanding of markets and is trusted by leaders across the financial industry. But he equally understands the real economy.

Born and raised in Upstate New York, he knows from personal experience how the actions of the Fed can change the lives of working families. It's no small thing. It's no small thing to know firsthand how an increase in gas prices or mortgage rates or an uptick in unemployment affect everyday Americans.

The Federal Reserve must not be ruled by pointy-head economists, poring over outdated models and reams of market data. It needs a leader. It needs a leader who understands that the Fed's mandate of stable prices and maximum employment serves a higher purpose, the preservation of the American dream. Now, colleagues, Kevin Warsh has lived the American dream. I know in my heart he will always fight to keep that dream alive for all Americans. He is the right man for this pivotal moment, and I urge you not to get caught up in the politics of the moment and support his speedy confirmation.

Thank you, Mr. Chairman.

SCOTT: Thank you, Senator McCormick.

I'll now swear in the nominee. Will you please stand and rise, raise your right hand? Do you swear that the testimony that you are about to give is the truth, the whole truth, and nothing but the truth, so help you God?

KEVIN WARSH, FEDERAL RESERVE CHAIR NOMINEE: I do.

SCOTT: Do you agree to appear and testify before any duly constituted committee of the Senate?

WARSH: I do.

SCOTT: You may sit down, your written statement will be made part of the record in its entirety. Please keep your oral comments to five minutes.

[10:25:02]

Mr. Warsh, you're now recognized.

WARSH: Thank you, Mr. Chairman. I appreciate your consideration today. I've known you for quite a while and I certainly appreciate the many courtesies you've given me, not just since the Presence nomination, but long before. It's an honor to be with you, with Ranking Member Warren and with the entire committee.

I'm deeply grateful to President Trump for asking me to take on this public trust, because that's what it is, a public trust. The president believes that real economic growth in the U.S. and real take home pay will accelerate. I share the president's confidence in our country and its people. America's economic growth potential is rising as we sit here today.

I'm also especially happy that my wife, Jane, is here. She has been with me for many of the most important moments in my life. I'm grateful for her love and her personal accomplishments. I reciprocate that with somewhat of my own love, though I'm a little more stoic than she. And about every 20 years, I reintroduce her to this committee. She sat behind me 20 years ago and it was almost 20 years ago to the day and so let me offer today what I said then, Jane, happy anniversary.

I'm also thinking of my late mom and dad. They were paying great attention to this hearing 20 years ago. They're no longer with us, but I was always proud of them and the values they taught me, and I hope they'd be proud of me today. We start today with a note of broad agreement, even though we might have heard different narratives at the outset of this hearing. This is a time of great consequence for the nation's economy. As a former Fed governor and friend or colleague of the last five Fed chiefs, from whom I've learned plenty of lessons, I'm particularly alert to the challenges and opportunities confronting the institution that I cherish, the Federal Reserve.

To the President, to the Congress, the nation, I owe my best judgment and my most faithful efforts in serving the mission that you and Congress assigned to the Federal Reserve, including full employment and stable prices. The American people are counting on the Fed to deliver on its commitments perhaps now more than ever.

The real highlights of my life are not on my resume, as Senator McCormick said. They include the individuals with whom I worked and from whom I learned. I graduated from high school in Upstate New York. I had some exceptional teachers there and some brilliant classmates. I've learned we're lucky in life if we start out with good influences in learning and in character. A public school education gave me both of those, and I'm grateful.

I made my way to Stanford and found myself in the company of some of the most highly accomplished economists and policymakers. George Schultz, former secretary of state and treasury, was among the great patriots at the Hoover Institution who I came to know as a teacher, mentor, and friend. He passed away right after COVID at age a hundred, but I still feel him with me.

I could not have imagined a better formative experience than working from and learning from folks like him. I could tell you about all the things I learned, but maybe the most important was to be around people completely devoted to the ideas and ideals of our country.

Silicon Valley in the early 90s, another fitting backdrop for all the things we confront today, I found myself in the right place at the right time. The U.S. was at the vanguard of a new era of technological leadership, and I just looked out my door to see it.

And in the last 15 years, I've gained deep experience in macro and in markets working with Stan Druckenmiller. He never held a position in government but is no less a patriot. He never got a PhD in economics, but I don't know a finer economic thinker. Without their guidance and the guidance of Condi Rice, my friend and I should say, my boss at the Hoover Institution. I doubt I would be sitting before you today as the president's Fed chairman nominee. But I'm certain of one thing absent their tutelage, absent their example, I would not be as prepared for the urgent mission critical task at hand.

In between these bookend experiences, I served quite a while ago as a governor at the Federal Reserve, at the birth, at the onset of the financial crisis. As Senator Warren said, our central bank played an indispensable role and we benefited enormously from the credibility that our predecessors had built up and passed down to us governors of the Fed at the time.

[10:25:09]