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Newsletter | Revolving Door Project Newsletter | February 16, 2022

Is Crypto Experiencing Inflation in the Price of Revolvers?

Congressional OversightCryptocurrencyDepartment of JusticeEconomic PolicyFinancial Regulation

From meatpackers to revolving door former senior staffers, the government can do a lot to rein in inflation without the Fed causing a recession

This edition of the Revolving Door Project newsletter was originally published on our Substack. View and subscribe here.

Inflation, it’s all anyone can seem to talk about. With prices rising at their fastest rate in more than three decades, the White House is understandably looking for ways to get things under control. Rhetorically, they’ve pointed their finger at corporate greed, highlighting the stark contradiction between companies’ claims that price hikes are unavoidable and their record profits (which, by definition, mean they can raise prices faster than their costs are rising). Action to follow that diagnosis, however, has been more muted. That is not because they don’t have options at their disposal. 

In the latest installment of our joint Corporate Crackdown Project with Data for Progress, my colleague Daniel Boguslaw and Data for Progress’ Aidan Smith and Anika Dandekar take a deep dive into several institutions that can strike against rising inflation at the root: the Departments of Commerce and Transportation and the Surface Transportation Board. In meticulous detail, the authors consider the powers that these departments’ key sub-agencies hold, how they have (or haven’t) exercised that power in the past, and how they might wield it to attack supply chain precarity and corporate consolidation moving forward. It’s well worth your time. 


There’s no denying that progressives have enjoyed nearly unprecedented success in the fight over this administration’s staffing. Nearly a year after President Biden took office, however, it’s becoming increasingly clear that securing strong senior appointments is only a fraction of the battle. Consider, for example, Secretary of the Interior Deb Haaland. Progressives fought hard for her historic nomination and had high expectations for her tenure based on her track record in the House. Yet, under her watch, the Department of Interior has failed to show virtually any signs of breaking with its long track record of aiding and abetting climate destruction. In some ways, it’s actually doubled down. The American Prospect’s Alexander Sammon took a look at why in a piece out yesterday. Those he spoke to pointed to the White House’s own lack of support and to the omnipresence of Obama and Clinton-era veterans who remain wedded to an outdated vision of the department. 

At the Treasury Department, meanwhile, the problem seems to lie more squarely with the once promising appointee herself. Secretary Janet Yellen has consistently and severely underperformed progressives’ hopes for her on financial regulation. As Bob Kuttner reported for the Prospect yesterday, some of that is policy disagreement, but much of it is disinterest. As a result, Yellen has almost completely delegated regulatory responsibilities to Under Secretary for Domestic Finance Nellie Liang, who appears entirely out of step with progressive priorities, including those that are being pushed by Biden’s other financial regulators. Progressive champions, meanwhile, have been marginalized. Although the White House has the power to step in and exert greater influence over the Department, it has opted for a hands off approach.

This is not to say that strong appointments are unimportant. Far from it. But it is clear that they are not sufficient. Appointees need to have the space to push their goals and the institutional infrastructure to successfully implement them. They must feel pressure to resist their own worst impulses and support to take on opposing forces within the administration. In other words, progressives must remain attentive to and engaged with the intricacies of the executive branch long after the top appointments are made if they hope to achieve their policy ends. (And as demonstrated by Data for Progress polling and, well, common sense, the sort of strenuous enforcement measures unfettered progressive appointees would undertake are wildly popular–enforcing longstanding laws limiting corporate lawbreaking is both progressive and “popularist.”)

Corporate America, for its part, never takes its eye off the prize. And former government officials are a key part of its strategy to get insight into every corner of the federal government and forestall regulation and enforcement. As the Biden administration has moved forward with more stringent measures across a wide range of policy areas, firms have been busy hiring. This week, the crypto firm Paradigm announced that it had brought on former SEC official Justin Slaughter. And last week, Amazon hired the former Chief of the Office Of Decree Enforcement And Compliance in the DOJ’s Antitrust Division, Lawrence Reicher. The savvy, yet greedy, intent behind these hires is clear for everyone to see. 

Yet, this administration has not taken meaningful steps to close the revolving door on the way out of government. In his ethics executive order, President Biden did ban former officials from communicating with officials in their former departments for two years and from shadow lobbying for one year. But he could and should have gone further to ban officials from working for the entities that they regulated for some set period of time. Recently, Senator Elizabeth Warren has been securing commitments from certain senior nominees not to work for regulated firms for a period of four years after they leave government service. It’s not too late for President Biden to look to standardize similar commitments across the executive branch’s senior ranks. 


It has been almost one year since we first published our litigation tracker highlighting the gap between the Biden administration’s stated policy goals and his Justice Department’s positions in court. The problem, however, has not gone away. Just recently, for example, the administration came under fire for the Education and Justice Departments’ decision to appeal a bankruptcy court’s ruling to discharge a borrower’s federal student loan debt because repaying them would represent an undue hardship. On the campaign trail, President Biden argued that discharging student loan debt through bankruptcy was too hard and vowed to make it easier. But here was his administration opposing a rare case where a borrower had won relief. It was only after the outcry that Ed. and the DOJ backed down. Clearly, however, they learned nothing from the episode. Not even a week later, they filed an appeal in another student loan bankruptcy case. (They subsequently withdrew that appeal as well after advocates and members of the public expressed outrage once again).  

Following this troubling series of events, we, alongside 16 other organizations, sent a letter to Secretary Miguel Cardona asking “the Department to immediately withdraw oppositions to individuals seeking undue hardship discharges in bankruptcy proceedings” while it designs and implements its promised reforms to its  “practices on opposing and appealing student loan discharges.”

My colleague Toni Aguilar Rosenthal has a new post on the blog detailing another dimension of this administration’s failure to deploy the Justice Department’s powers to change policy in line with its priorities. Over a year after President Biden took office, he has yet to nominate officials for the majority of the 93 U.S. Attorneys positions. So far, he has put forward only 42 nominations. Of those a mere 31 have been confirmed. 

As Toni highlights, this lack of permanent leadership is delaying progress on criminal justice reform and white collar enforcement across large parts of the country. Importantly, the distribution of these vacancies and the associated consequences are not random. “Of the 43 who have been named by the White House, 34 (79%) come from Senate delegations with at least one Democrat, while just nine (21%) come from states with entirely Republican delegations.” The Senate blue slip process, which gives home state Senators effective veto power over a president’s U.S. Attorney nominees, is likely to blame. Rather than abandoning blue slips (as Senate Republicans did under President Trump), it appears that Biden may be wasting time negotiating with Republican Senators, or simply punting on the fight and avoiding nominating officials altogether. 

Congressional oversight

Momentum continues to build for legislation to restrict congress members’ stock trading activities. After initially opposing such measures, Speaker Nancy Pelosi tentatively gave the greenlight last week. Exactly what version of restrictions she intends to support, however, is not clear. That’s important because there are many different proposals out there at the moment. They vary in what they do (e.g. forcing divestiture or requiring lawmakers to put assets into a blind trust), to whom they apply (just to members and/or to their spouses and/or dependent children), how biting their fines ($50,000 per violation or the member’s annual salary), and more. 

Pelosi has indicated that the House Administration Committee will be in charge of sorting out what from the various proposals makes it in and what is ultimately jettisoned. Given that the committee is chaired by her close ally Rep. Zoe Lofgren, the Speaker is likely to have an important say over the outcome if she wants it. (Note, also, that Lofgren is not exactly a neutral party. She has come under scrutiny for her husband’s holdings in several Big Tech giants while she loudly opposes more stringent antitrust legislation those firms are lobbying against.) 

Independent Agencies

The glacial confirmation process may be about to get even slower. Senate Republicans seem to have struck upon a new strategy to slow confirmations or even stop them altogether. Yesterday, just hours before the Senate Banking committee was set to vote to discharge Biden’s five nominees for the Federal Reserve, ranking member Pat Toomey announced that the committee’s Republican members would be boycotting the vote to deny the committee a quorum. Although Senate Democrats can still vote to discharge the nominees, Senate rules prevent a final confirmation vote for nominees who were discharged from committee when a majority of committee members were not present. Right now it’s the Federal Reserve, but Senate Republicans could easily expand this tactic to all outstanding nominations, including dozens of independent agency nominations. It’s not hard to see how this could quickly become disastrous. 

If they do begin a campaign of maximum obstruction, Senate Democrats are not without options. They can go “nuclear” to change the Senate rule that bars these confirmations. They have more than enough reason to. Senate Republicans have not only obstructed Biden’s nominees throughout this year but, as we have noted before, also helped to deny Democrats seats on independent agency boards all throughout the Trump years. 

Want more? Check out some of the pieces that we have published or contributed research or thoughts to in the last week:

Crypto’s aspiring Washington kingmaker 

Top Black Women Candidates for Biden’s Supreme Court Judge Nomination 

President Biden’s Supreme Court Nominee Will Be….

Spouses, taxes and crypto: The unanswered questions for Congress’ stock trading ban 

Will Discharging Student Loans In Bankruptcy Get Easier? Biden Administration Sends Mixed Messages 

Biden’s hack gap on inflation

Biden’s BIG PHARMA, BIG TECH-Aligned FDA Nominee Robert Califf Faces Criticism For Consulting Past

Despite Pledge, Biden Still Fighting Student Debtors In Court

YOU LOVE TO SEE IT: Biden Faces Mounting Pressure On Student Debt

Will Discharging Student Loans In Bankruptcy Get Easier? Biden Administration Sends Mixed Messages 

In New Report, Data for Progress and the Revolving Door Project Show That The Departments of Commerce and Transportation Can Combat Inflation And The Supply Chain Crisis

What Happened, Ms. Yellen? 

A Look Inside Interior 

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