Big Oil Fuels Opposition to Former Bush Financial Regulator Saule Omarova

Attacks on a key Biden administration appointee to regulate big banks are being funded and promoted by oil and gas interests, a sign of the job’s potential to limit risky lending to fossil fuels.

Omarova nomination. Credit: Axios

Cornell Law Prof. Saule Omarova is President Biden’s nominee to head the Office of the Comptroller of the Currency (OCC), overseeing the nation’s biggest banks. She has signaled plans to use existing powers to strengthen the financial system’s safety and soundness for households, workers, and communities. Although a departure from recent OCC heads who viewed Big Banks as “clients” of the office, Omarova has earned ample mainstream credibility through stints in the George W. Bush Treasury and at the corporate law firm Davis Polk & Wardwell.

That’s what makes recent Republican attacks on her all the more surprising — at least until you consider the source. The smears by Senate Banking Committee members echoed regressive red-baiting initiated by the banking lobby, who sought to discredit her because she was born in Kazakhstan and later defected from a Communist regime. And they emanated from lawmakers who benefit directly from the fossil fuel industry, which stands to shoulder more of its own costs under Omarova’s leadership.

“I don’t know whether to call you ‘professor’ or ‘comrade,’” Republican Sen. John Kennedy of Louisiana said in one such moment, dusting off a McCarthyism-era playbook. It might have passed as a mere failed political stunt, if not for the broader context: Fossil fuel special interests and lobbyists are calling in political favors in an effort to take her down because Omarova’s willingness to address systemic climate risk associated with toxic fossil fuel investments and question big-bank orthodoxy scares the heck out of them.

Although little known to the public, Comptroller of the Currency is among the most powerful positions in government, tasked with ensuring the safety and soundness of the national banking system, including fair and equal access to financial services to all Americans. Under this mantle, the OCC will play a crucial role in the Biden administration’s initiative to improve oversight of climate-related financial risk.

Over and over, Senators who took millions from fossil fuel interests roasted Omarova during her hearing. Over their careers, Senate Banking Committee members have raked in at least $23.3 million from the fossil fuel, energy, and natural resources sectors. Many of these same committee members were outed as Big Oil allies by a former ExxonMobil lobbyist earlier this year, so it’s easy to imagine fossil fuels relying on these interests to drum up opposition to Omarova.

Omarova would be the first woman, immigrant, and person of color to hold the office.

At her hearing, she said she would bring a “unique appreciation for our dynamic and diverse markets” to the position.

“It is what made my life and success possible and for that, I am forever grateful” she said. “Every American family should have the same opportunities that my family has had. If confirmed by the Senate, I will work to ensure that our financial system gives every family the tools they need to build their own American dream.”

More than 60 civil society organizations publicly supported Omarova — including unions, lending, environmental, financial, business, and agricultural organizations — saying she is committed to helping working families by ensuring bank oversight is fair for everyone, not Wall Street and Big Banks.