Opinion | Finance

Biden bank regulator nominee reveals her plan to radically transform US economy

The views expressed by contributors are their own and not the view of The Hill

While running for president, Joe Biden campaigned as a lunch-pail-carrying, blue-collar moderate from Scranton, Pa. But during his short tenure in the White House, Biden has proven himself to be a far-left champion of bureaucracy, reckless government spending and the centralization of economic and political power. 

The most recent example is Biden's nomination of Cornell law professor Saule Omarova to head the Office of the Comptroller of the Currency, a branch of the Treasury Department. 

Omarova is a controversial choice. Born in the former Soviet Republic of Kazakhstan, Omarova was educated in the Soviet Union, graduating from Moscow State University in 1989, and as recently as 2019 openly praised various Soviet policies. 

Omarova's university thesis has raised alarm bells. Although no one knows exactly what she wrote in the thesis, its title, "Karl Marx's Economic Analysis and the Theory of Revolution in The Capital," coupled with her refusal to hand the paper over to members of the Senate Banking Committee, has led many to believe Omarova's views on Marx are out of step with Americans' largely pro-market sentiments.

Even more pertinent, Omarova has called for moving most of the consumer banking industry out of private institutions and into the hands of the Federal Reserve

According to past statements, Omarova's vision for transforming the U.S. economy involves significant centralization of investment and banking, putting a new public institution in charge, directly or indirectly, of virtually all economic activity. In an extensive interview with MSNBC host Chris Hayes in 2020, Omarova outlined some of her most expansive proposals to reshape the United States.

After complaining that the current financial system does not do enough to ensure private institutions prioritize issues such as climate change, Omarova told Hayes that a new federal agency should be created to restructure the American economy to make it

"more resilient in the face of shocks, big pandemics, big climate change, big whatever kind of shocks we experience that we have resources that we can mobilize and reapportion in the way we need it."

Omarova's proposed public institution, which in her interview with Hayes she referred to as the National Investment Authority (NIA), would be a "public entity that acts directly in financial markets and acts as a venture capitalist, as a private equity investor, as a lender, as a guarantor, as an insurer, to basically make it easier, not only for the public capital but for the private capital to flow into more sustainable industries rather than into the dying industries."

Like the Federal Reserve, the National Investment Authority would have a governing board, with seven to nine members appointed by the president for terms of 10 to 12 years.

Through "special federal charter government corporations," Omarova's NIA would provide banking and investment services directly to industries and projects favored by the federal government. It would, in effect, become, in her words, "the asset manager, like a private equity firm, like a venture capital firm like BlackRock," except instead of being run by private individuals and groups, it would operate on behalf of the collective, with the full faith and credit of the U.S. government. 

Omarova imagines the NIA to be America's "public manager" that "will select" investment projects for the country, but "not on the basis of what is the most profitable in the next five years, in the next seven years."

The federal government is in "a position to make that kind of a decision," Omarova added, because it doesn't have to worry about financial losses in the near term; it can simply finance the debt through money-printing and taxes.

The idea that Omarova could soon oversee one of the United States's most important financial regulatory agencies is shocking. But even if Omarova is rejected by the Senate - a very real possibility considering that some Senate Democrats have expressed serious concerns about her nomination - that the White House would even consider her to head a key regulatory agency reveals that the Biden administration is interested in fundamental transformations of the U.S. economy, not moderate policies that would unite the country.

If Omarova's ideas are put into place, a politicized board central planners would effectively be empowered to lord over American society and eliminate many of the liberties inherent in our free-market economic system.

Justin Haskins (Jhaskins@heartland.orgis the director of the Stopping Socialism Center at The Heartland Institute and the co-author, with Glenn Beck, of the forthcoming book, "The Great Reset: Joe Biden and the Rise of 21st Century Fascism."