GOP Congressman Says Biden's Banking Nominee Has Ideas Rooted in a 'Socialist Manifesto'

President Joe Biden's nomination for the next head of the Office of the Comptroller of the Currency faces backlash from Republicans, who are saying she is planning to nationalize the banking system.

The Senate is currently examining Saule Omarova's nomination for the role. Many Republicans are scrutinizing her upbringing in the former Soviet Union and academic papers she wrote.

One senator, Pat Toomey of Pennsylvania, has taken things one step further by claiming she has a socialist agenda. During the Senate hearing for her new role, he said, "taken in totality, her ideas do amount to a socialist manifesto for American financial services." He also requested to see a paper written about Karl Marx in what he calls "the original Russian" when she attended Moscow State University. Omarova said she could not provide a copy of it because she no longer had it.

The labeling of her as a socialist could be a reference to a paper she published in 2020. In it, she argued that the nation's banking system needed an overhaul that would extend credit faster to individual accounts in times of need. However, the idea and her nomination for the role have been pushed back by banking lobbyists.

"I wish the community bankers and their trade associations actually read more carefully what I have written," Omarova told the Associated Press.

While her birth in the former Soviet Union has elicited criticism from Republicans, she says that she immigrated to the United States after family persecution in Kazakhstan. She arrived in the U.S. in 1991 and has most recently worked as a professor of law at Cornell University, testifying in cases as an expert on financial regulation. She became a U.S. citizen in 2005.

The nomination of Omarova is expected to be voted upon in December.

For more reporting from the Associated Press, see below.

Saule Omarova
Saule Omarova of New York is sworn in during a Senate Banking, Housing, and Urban Affairs hearing on Capitol Hill in Washington to examine her nomination to be the Comptroller of the Currency, on November 18. AP Photo/Manuel Balce Ceneta

Democrats say she's eminently qualified and would be a tough overseer of Wall Street.

If confirmed, she would be the first woman and person of color to run the 158-year-old agency.

Omarova is a longtime academic and well-regarded expert on financial regulation.

On Thursday, Omarova fielded questions about her academic writings and whether she would have the power to implement those proposals. She was also asked by Republicans whether it was appropriate for banks to not lend to certain industries if they chose, such as the oil and gas industry and gun manufacturers. Democrats focused on blunting the GOP attacks.

Another Republican senator, referring to Omarova's childhood in the former Soviet Union, said he did not know whether to call her "professor or comrade."

During the hearing, Omarova said she would be an advocate for smaller banks and keep a close eye on the large banks that tend to outcompete smaller institutions.

"You've clearly scared the heck out of them," said Sen. Mike Rounds, R-South Dakota, referring to the banking industry's opposition to her based on her writings.

Sen. Elizabeth Warren, D-Massachusetts, a longtime critic of the big banks, called the criticism of Omarova "a vicious smear campaign, coordinated by Republicans who are doing the [industry's] bidding."

The nomination could hinge on moderate Democratic senators who sit on the Banking Committee: Jon Tester of Montana and Kyrsten Sinema of Arizona. Republicans are united in their opposition and Toomey and others tried to paint Omarova as a radical choice in order to dissuade Tester and Sinema from giving their support.

Tester said during his questioning he still had "significant concerns" about Omarova's nomination even after meeting with her privately. Tester focused most of his questions on Omarova's previous opposition to a bipartisan law that eased some of the restrictions placed on banks after the 2008 financial crisis. He was a co-sponsor of that law.

Omarova said her criticism of that law was narrow. She said she approved of how it lessened the regulatory paperwork required of small community banks.

While some senators at the hearing tried to downplay this narrative, the issue was raised by Sen. John Kennedy, R-Louisiana. The senator inquired as to whether Omarova still had a membership with youth Soviet communist organizations.

"I don't know whether to call you professor or comrade," Kennedy said, a comment that elicited some gasps in the hearing room and, later, a rebuke from the chairman of the committee, Sen. Sherrod Brown, D-Ohio.

"I am not a communist," Omarova said strongly. "I could not choose where I was born."

Pat Toomey
Ranking member Pat Toomey questions nominee to be the Comptroller of the Currency Saule Omarova as she testifies before the Senate Banking, Housing and Urban Affairs Committee during a hearing on Capitol Hill on November 18. Photo by Jim Watson/AFP via Getty Images