Sen. Elizabeth Warren, Democrat of Massachusetts and ranking member of the Senate Banking, Housing, and Urban Affairs Committee, during a public hearing on Thursday, March 26, 2026, in Washington, DC, USA.
Aaron Schwartz | Bloomberg | Getty Images
Sen. Elizabeth Warren sent a scathing letter to Federal Reserve Chairman candidate Kevin Warsh on Thursday, predicting that he would become a “rubber stamp for President Trump’s Wall Street First agenda” and accusing him of “not learning from your mistakes” during his previous stint at the central bank.
In a letter first reported by CNBC, the Warren Democrat, D-Mass., told Warsh that his history as a member of the Federal Reserve Board from 2006 to 2011, which included the 2008-2009 financial crisis and Great Recession, “should disqualify him from promotion.”
“But President Donald Trump has vowed that no one who opposes him will ever become Fed chairman,” Warren said.
“And apparently you passed his test,” she added.
“As Fed Chairman, you will be responsible for directing policies that will transform the economy.
“You have had a profound impact on American workers and communities,” Warren wrote, “but your track record leading up to, during, and after the 2008 financial crisis raises serious concerns about your capabilities.”
The letter, obtained by CNBC before publication, asked detailed questions that Warsh identified as 10 different subject areas that Warren would have to answer during her confirmation hearing before the Democratic-led Senate Banking Committee.
But those questions were buried beneath a scathing eight-page indictment of his tenure at the Fed and his assertion that after he left the central bank, he would “oppose tougher safeguards aimed at failing big banks and strengthening taxpayer bailouts.”
“I write this letter to better understand what you gained from your failure to prioritize American families over Wall Street before, during, and after the 2008 financial crisis while serving on the board of the Federal Reserve Board,” Warren said in the first sentence of the letter.
“Rather than implementing policies to improve the lives of Americans, you ignored Wall Street’s clearly excessive risk-taking, worked tirelessly to bail out big financial institutions after their bets took a toll on the economy, and advocated for policies that would further harm millions of Americans who lost their jobs, were evicted from their homes, and saw their savings evaporate,” she continued.
Warsh did not immediately respond to a request for comment from CNBC about the letter.
Warsh’s nomination has stalled after Warren’s colleague on the Banking Committee, Sen. Thom Tillis, R-N.C., said he would effectively block the full Senate from considering the nomination until the criminal investigation into Fed Chairman Jerome Powell is resolved.
Jeanine Pirro, the U.S. attorney for the District of Columbia, said she has no intention of dropping the investigation.
Mr. Pirro’s office is seeking to overturn a March 11 ruling by a federal judge in Washington and block subpoenas issued to the Fed as part of the investigation into Mr. Powell. The investigation is said to focus on cost overruns for an expensive renovation of the Federal Reserve’s headquarters and testimony to the Banking Committee about the project.
In an order canceling those subpoenas, District Court Judge James Boasberg wrote, “There is abundant evidence that the primary (if not the only) purpose of the subpoenas is to harass and pressure Mr. Powell into yielding to the President or resigning to make way for the Fed Chairman.”
Since retaking the White House in January 2025, Mr. Trump has repeatedly and unsuccessfully pressed Mr. Powell and the entire board to cut rates faster and more deeply than before.
Powell said in early March that he would remain pro-tem if Warsh was not confirmed by the end of his term in May.
In a letter to Warsh on Thursday, Warren said there were “warning signs of a coming crisis” in the subprime mortgage market when he first began serving on the board.
“Yet, instead of using the Fed’s strong supervisory and regulatory authority to address the serious consumer and financial stability risks posed by subprime lending, you championed and even implicitly promoted these products,” Warren wrote.
“Surprisingly, in December 2007, you agreed that “subprime mortgages have a bad name.”
“In this environment, you also promoted derivatives and other forms of ‘financial innovation’ as a means to spread risk and make the financial system safer,” she wrote.
“You were wrong again.”
Warren said that during the resulting financial crisis, “you appear to have put the interests of big financial institutions ahead of the American people.”
“Given that you spent seven years as a mergers and acquisitions executive at Morgan Stanley before joining the George W. Bush administration, your eagerness to bail out Wall Street through things like taxpayer-supported megamergers was not surprising,” Warren wrote.
“It is well documented that you played a central role in arranging numerous (billion-dollar) bailouts and also obtained an ethics waiver to deal directly with Morgan Stanley, which obtained special regulatory approval from the Fed on an emergency basis to access additional emergency assistance.”
The senator said Mr. Warsh also advocated raising interest rates at the time, which he said would have drained jobs and “further jeopardized a deteriorating economy.”
“The monetary policy record has repeatedly shown an inability to accurately assess the impact of inflation on the American economy,” Warren wrote.
“You don’t seem to have learned anything from your mistakes,” she wrote.
“Since leaving the Fed, you have advocated against the failure of large banks and stronger safeguards aimed at bailing out taxpayers.”
—CNBC’s Matt Peterson contributed to this article.
