Audrey Streb
DCNF Energy Reporter
The Federal Reserve failed to prioritize its core mission to combat inflation while embracing the Biden administration’s green energy agenda, economic and energy policy experts told the Daily Caller News Foundation.
Under Fed Chairman Jerome Powell’s leadership, the Fed joined a global climate change group and took other steps to align with President Joe Biden’s climate agenda while failing to effectively manage primary responsibilities, according to economists and energy policy experts. Though Powell once told Congress that the Fed is not made of “climate policymakers,” Biden later said that Powell “made clear to him” that the Fed would work to mitigate economic climate risks while inflation reached a 40-year high, according to multiple reports and experts who spoke with the DCNF.
“Right after the most recent presidential election, the Federal Reserve gave up on the whole green energy agenda,” EJ Antoni, chief economist at the Heritage Foundation, told the DCNF. “The Fed ultimately came to the conclusion [under Biden] that lending to fossil fuel projects involved a new level of risk — not because of repayment risk, but because of climate change.” (RELATED: Fed Chair Jerome Powell Quietly Insists He Won’t Resign)
US President Joe Biden (R) announces Jerome Powell (L) as his nominees for Chair of the Board of Governors of the Federal Reserve Systems during an event at the White House in Washington, DC, on November 22, 2021. (Photo by JIM WATSON/AFP via Getty Images)
Antoni argued that upon Trump’s return to the Oval Office, the Fed reversed its green doctrine that was aligned with “absolutely ludicrous” Biden-era energy policy.
The Fed became a member of the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) in December 2020. The NGFS supports a green energy transition and seeks to inform banks on how to integrate climate risks into banking practices. The Fed announced its exit from the NGFS on January 17, right before Trump returned to office.
“They very quickly realized that there was a new sheriff in town, and that they didn’t need to try to appease the far radical left any more, especially on energy,” Antoni said.
Trump has recently criticized Powell, prompting rumors that Trump may fire him. Trump later said in an interview that he will “most likely” not fire Powell because doing so would be “highly disruptive,” and Powell is reportedly not planning to step down before the end of his term in May 2026, according to Reuters.
“You know what? People aren’t able to buy a house because this guy is a numbskull,” Trump said of Powell, according to Reuters. “I think he’s done a bad job, but he’s going to be out pretty soon anyway. In eight months, he’ll be out.”
Inflation was at 1.6% when Powell said in February 2021 that the Fed cannot decide how climate change will be addressed as it isn’t comprised of “climate policymakers,” according to RealClearPolitics. When Biden assured Americans in November 2021 that Powell was committed to tackling climate change, inflation had already reached 6.8% and was climbing toward a 40-year high of 9.1%, according to the outlet.
Powell endorsed the Financial Stability Oversight Council’s (FSOC) Report on Climate-Related Financial Risk in October 2021, stating that “climate change poses significant challenges for the global economy and the financial system” and that “the public rightly expects us to work to ensure the financial system is resilient to climate-related financial risks.” The report identifies climate change as a financial risk to the U.S. economy and recommends council members take action on climate change data.
“Chair Powell has been clear that the Federal Reserve is not a climate policymaker and that those decisions must be made by the elected branches of government,” a spokesperson for the Fed told the DCNF.
Though the Fed and Powell have consistently argued that the agency does not craft regulatory policy, Antoni argued that the Fed holds influence beyond its ability to curb inflation.
“People really underestimate the regulatory power of the Federal Reserve,” Antoni said. “The Fed will essentially force people in the financial industry to make choices based on the regulatory consequence.”
Antoni likened the Fed’s meddling in energy markets to past regulatory interventions in home loans that contributed to the ruinous 2008 housing crash
“Regulators essentially forced financial firms to make risky loans to people who likely would never be able to pay them back and just in order to meet regulatory compliance, those financial firms had to put themselves into a riskier position,” Antoni said. “Capital was diverted away from profitable enterprises … and towards unproductive ones like solar panels or windmills.”
The Fed issued principles for managing climate-related financial risks in October 2023, which increased the perceived risk of loans to fossil fuel companies, according to Antoni. (RELATED: American Energy Firms Are Counting Down The Days Until Trump’s Return)
The Fed’s Biden-era embrace of climate priorities meant that green energy projects like wind or solar got financial backing they otherwise would not have while making it harder for other energy resources like coal, natural gas, oil or nuclear to secure investment, Antoni explained.
“It [the Fed] essentially created huge inefficiencies within both the financial and energy markets,” Antoni said, arguing that the wind and solar industries only exist due to government subsidies. Antoni continued to note that the Fed began to consider projects using fossil fuels as an increased risk, which he described as “mental gymnastics.”
“The Federal reserve was established to prevent financial crises in the U.S. by maximizing employment, stabilizing long term interest rates, and stabilizing prices to prevent or moderate inflation,” Sterling Burnett, director of the Arthur B. Robinson Center on Climate and Environmental Policy at The Heartland Institute, told the DCNF. “Powell’s foray in climate policy was the grossest form of politicized mission creep — and all to keep his own job. Nowhere is the Fed in its charter, granted the power to meddle in domestic policy, much less address climate change. It’s past time for Powell to go, taking his leftist politicization of the Fed with him. Powell’s climate efforts are bad for the reputation of the Fed, and bad for the nation.”
When inflation was increasing in March 2024, other critics argued that if the Fed had paid less attention to climate risks, the system might have been more stable. Despite the Fed focusing on climate change during Biden’s presidency, environmental activists still aggressively targeted the agency, pressuring Powell and claiming that he had not waged a hard enough assault on the oil and gas industry.
“Jerome Powell’s transition from a man who understood his crucial role at the Federal Reserve to man who was willing to pander to the climate ideologues at the Biden Administration, was a key reason for the unbridled inflation and weak economy of the past few years,” Executive Editor and Publisher of ClimateDepot.com Marc Morano told the DCNF. “Powell, who was facing opposition by climate activists during Biden’s term, is a case study of how officials who crave holding on to power are willing to sell out their principles and go against their own economic instincts.”
NGFS did not respond to the DCNF’s request for comment.
All content created by the Daily Caller News Foundation, an independent and nonpartisan newswire service, is available without charge to any legitimate news publisher that can provide a large audience. All republished articles must include our logo, our reporter’s byline and their DCNF affiliation. For any questions about our guidelines or partnering with us, please contact licensing@dailycallernewsfoundation.org.
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Be bold and fire Powell, show that you have true cojones and abolish the fed entirely.
No use just to chop off one of the hydra’s heads.
Firing is the easy part. Who do you replace him with?
Be bold and take the bloody Federal Reserve back. The USA is company, financially controlled by international banks who are not your friends. In the 112 years since it was formed, they have sucked the life out the USA with the sole motivation of destroying and fully owning it. Over 80% of the people subsist on their weekly pay check. Due to pharmaceutical manipulation you are one of the sickest societies in the world. So much for “God Bless America”. Look at where you are at.
FFS America, get up and off of your knees.
Powell drank the Green New Deal Kool
Aid.
This article strongly implies that Powell’s involvement with climate change policy somehow caused the high inflation we saw towards the end of Biden’s term, without any evidence.
The article wants us to think that the inflation jump had something to do with Powell’s commitment to tackling climate change, but there’s no evidence of that. Maybe inflation would have jumped anyway. Didn’t it jump all over the world, including in countries where the Fed equivalent didn’t change its position on climate change (if it even expressed a position in the first place)?
In October 2024, before Trump was elected, the CPI 12-month change had already fallen to 2.6% (or 3.3% if you subtract food and energy). https://www.bls.gov/news.release/archives/cpi_11132024.htm
Is this because Powell had changed his views on climate change? I don’t think so. I think his view on climate change never had anything to do with it in the first place. What really happened was that covid had snarled our supply chains and there was inflation (worldwide) while everyone sorted it out post-covid.
Powell endorsed a report. Did he take any particular action based on this report, or was it just window dressing?
The Fed “issued principles”? Did these principles have any measurable effect on anything, or were they just window dressing?
The article says that the Fed abandoned its climate nonsense just before Trump took office. If inflation now starts to rise again, will that indicate that the Fed’s new lack of a climate stance is driving inflation? Or will The Daily Caller simply declare that climate change has nothing to do with it?
This is a very biased article.
Geesh! Powell is one of the few competent people in Washington these days. Unlike the White House economic dunces.
Sonicsuns wants us to think that the article wants us to think that the inflation jump had something to do with Powell’s commitment to tackling climate change, but there’s no evidence of that.
This is a very biased comment.
What is the point of this article, if not to imply that “the inflation jump had something to do with Powell’s commitment to tackling climate change”? Why spend so many paragraphs juxtaposing these two things, if not to suggest causation?
Consider the first sentence:
Now in theory they could have also written “The Federal Reserve failed to prioritize its core mission to combat inflation while the Kansas City Chiefs went on to win two Super Bowls”, but wouldn’t you find that odd? Do news outlets really just mention totally unrelated things in close connection like that? Would they go on for several paragraphs about how the Fed did this and the Chiefs did that, unless they were trying to imply there was some sort of connection?
Come on.
Your comments made some important points, but failed to include the important trillions of dollars wasted by the Biden led government. Spending money you don’t have always causes inflation, too. The history of the world has proven that government run central planning always fails, and well-informed individual entrepreneurs almost always succeed.
“The history of the world has proven that government run central planning always fails,” okay
“and well-informed individual entrepreneurs almost always succeed.”
no, not at all. Some well-informed individual entrepreneurs succeed, most well-informed entrepreneurs almost always fail.
Anyone reading this knows that most restaurants fail in the first year. They’ve known it since they were a kid. The actual people opening the restaurants know it too.
A counter example would be Bill Gates. So how mnay guys of his era could have done what he did but didn’t? We don’t recognize their names.
Thank you.
Powell doesn’t bear any blame for that. He didn’t sign the IRA. He didn’t distribute climate funds. If someone wants to write an article called “Biden spurred on inflation with wasteful spending” then sure, we can talk about that. But let’s not pretend that these two subjects are the same.
And I think you exaggerate. Total discretionary outlays (including the military) amounted to about $1.7 trillion per year under Biden. Under Trump it had been about $1.3 trillion per year up until 2020, when it jumped to $1.6 Trillion. If we assume that $1.6 trillion per year is the appropriate amount to spend in a pandemic (and apparently Trump thought so), then Biden’s $1.7 isn’t pretty standard for 2021 and 2022. If perhaps spending should have dropped back to $1.3 trillion as of 2023 and 2024, that leaves us with an extra $400 billion per year, or $800 billion over two years, which is a lot of money but still not “trillions wasted”, particularly not with “trillions” in the plural.
Perhaps you’re counting the money that Biden had planned to spend at a later date? But how would that cause inflation? In particular, how could Biden’s future plans cause inflation to decline during 2024?
I think it was mostly an issue of covid messing with our supply lines. https://www.cnbc.com/2024/07/11/high-inflation-is-largely-not-bidens-or-trumps-fault-economists-say.html
That’s a false dichotomy. There are many possible levels of “central planning”, ranging from totalitarianism to anarchy. Are you an anarchist? If not, then we’ll need to discuss the correct amount of “central planning”.
Personally I think the US was too laissez-faire in the 1920s, and “entrepreneurs” helped push us into the Great Depression with a giant investment bubble. (Granted, the government’s tariffs weren’t much help.) It was FDR who used massive government spending to keep the economy afloat, and when WW2 prompted even higher levels of spending, we left the depression behind entirely. (And while we were at it we passed laws to protect workers from their bosses. Entrepreneurs often seek profit above all else, to the detriment of the working class.)
That’s not to say that central banks can’t screw things up, of course. I hear that Japan’s “Lost Decade” was largely the fault of their central bank. But still, this whole thing is more complicated than you’re making it sound.
This post doesn’t address the effect of high interest rates on green energy. Since green energy is capital intensive to install, high interest rates require higher electricity prices to cover the cover the cost of installation. Remember in 2023 and 2024 the number of bidders on wind power dropped precipitously if the auction prices for power did not rise with the interest rates.
High interest rates also impacted the social cost of carbon. A higher discount rate means that future impacts are considered less significant than present impacts, resulting in a lower SCC estimate. All things being equal,
the Biden administration’s interim SCC estimate of $51 per ton was based on a 3% discount rate, while a 2% discount rate more than doubles that estimate. The discount rate in the fall of 2024 was 5.5%
Powell’s high interest rates over the last 3 years made green power much more expensive and the social cost of carbon used to justify the transition much lower.
Interest rates are meaningless when you are virtually 100% subsidised through government and ‘other people’s’ money.
“Social Cost of Carbon”
What a boondoggle.
I think you are selling the Chairman short. He did not cave into extreme pressure from the green mob to impose climate change risks in Fed’s regulations.
He most certainly did capitulate.
More likely, it’s mission is to issue money and control how much money is in the financial system.
By controlling inflation to the often stated 2% ….think of the ramifications.
1.02 ^35 =2 so every generation or so, the value of everything doubles. Very beneficial for government coffers on capital gains and inheritance taxes. Essentially the government taxes the inflation gains that they caused themselves.
Also the general population can be “happier” and “getting ahead” with wage increases every couple of years. Plus if you need to, you can allow government debt to be paid back long term with dollars of lesser purchasing power by letting inflation go higher.
Everyone benefits unless some politicians push low interest rates and issuing of many dollars into the system for vote buying purposes.
Most modern countries have separated central banking from their elected representatives to keep them from spending government money in amounts that cause exhorbitant inflation so that long term contracts like mortgages don’t become valueless over their 20 to 30 year duration, which would result in no one willing to extend loans for long term projects of high value.
So a little bit of inflation is good…a lot is bad….
Why would it be better for the general population to have prices go up and the purchasing power of your savings go down?
How can the ‘value’ of everything double in a generation while the purchasing power of your fiat money is melting like snow in the Sahara summer sun? If I get more dollars for my old house when I sell it but also need more dollars to buy the new house how does that make me richer?
Why should I be happy about paying higher taxes and how do direct taxes make me freer?
There is nothing good for the general population to have inflation of the fiat currency supply.
You’re missing the point. It’s “better” for governance purposes, not necessarily individuals. It’s “better” for the government if the general population is happy. When they aren’t happy, overthrow of the governing bureaucracy is bound to occur, usually followed by half a century of citizen strife establishing control from the overthrow era renegades.
At 2% inflation, people don’t much notice the basic devaluation of their purchasing power, while the odd 5% raise feels like they are getting ahead. No need to get out the pitchforks and guillotines followed half of a century of warlord administration.
“Very beneficial for government coffers on capital gains and inheritance taxes”
Fedeal Inheritance Taxes aren’t much of an issue in USA.
“The federal estate tax is a tax on property transferred from a deceased person to their heirs. Only the portion of an estate’s value that exceeds a certain exemption level is subject to the tax.
Exemption Amount: The basic exclusion amount (also known as the exemption) for estates of individuals who die in 2025 is $13,990,000.”
If people inheriting more than $13,990,000 want a new law, they can buy a new law.
Most of the world has capital gains tax whereby the amount of fair market value gain since purchase….is taxed at personal income tax rates on 30-60% of the gain and paid out of the deceased individual’s estate, usually with some basic exemption. Many governments are at their maximum “take” on capital gains tax because often the banks won’t lend the heirs of a small business enough money to pay the taxes…and the resultant closure results in bad press for the cap gains tax.
Graduated income tax.
Storytip:
https://www.usatoday.com/story/cars/news/2025/08/11/mercedes-benz-eu-emissions-ban/85618782007/
What gets me is you have these high paid executives and only know have they worked that out after initially embracing it. In the articles posted on WUWT recently and you looked at the EV sales data it was blind fredy obvious the EU and UK car markets will collapse they are barely making mandated levels and what sales there was are cheap chinese imports.
The AGW hypothesis has been falsified by science. Mankind does not have the power to change the Earth’s climate. Mankind does not even know what the oprimal global climate actually is let alone how to change it. Spending money to fight climate change is a complete waste of funds. To fight infaltion federal spending should be reduced and not increased. The Biden administration’s bill to fight inflation was a total scam and Biden essentially admitted it. All continued spending with regard to tht program should immediately be stopped. The federal government never had the moeny for this.
Governments don’t actually have any money. People have money, and governments take some of it. That gaping hole in your wallet or bank account is what they’re spending.
Printing money and causing inflation is a sneaky way to steal citizens’ money without being obvious. But stealing it they are.
The Federal Reserve specifically the Chairman is utterly unaccountable to anyone. That must change. This clown Powell is creating the hanging gardens of Babylon in DC at $3billion and counting, these are public funds, it is absurd.
The fact is the Fed runs at a loss, and is borrowing money from the public. The Fed’s budget (& debts) it has racked up is off balance sheet so it does not count towards the bloody debt ceiling! Powell and his cronies are not accountable to Congress.
Lack of governance and accountability and the Fed Chair also acts as the damn CEO just keeps spending money. There is no public company that would pass any type of legal or regulatory audit if structured that way.
Can anyone name who the vice Chair of the Fed is? exactly it all goes through Powell with zero oversight.
It is time for Congress to act and pass law if required to hold the Federal Reserve accountable like every other federal agency..
If The Federal Reserve is not accountable to Congress than it is no longer We The People who are in power. A centrally controlled economic system = Communism.
Saw a sentence worth noting
“the maths behind the AI boom make(s) little sense”
This applies equally to renewables
“the maths behind the renewables push makes little sense”
“Over the same three years that the AI revolution has been in full swing, labour productivity has grown at barely 1% a year, maintaining a decades-long trend of declining growth across Western countries.”
Source: Is the AI bubble about to burst? Unherd
Jerome Powell has not been exactly a model in clear mathematical logic.
“The labor productivity formula is a simple ratio that divides the total output by the total labor input. The basic formula is: Labor Productivity = Total Output / Total Labor Input.”
As Total Labor Input approaches zero, Labor Productivity approaches infinity.
Mathmagic
I don’t like sympathizing with strangers in high places, JP might be a total d—wad, but from about 2020-2024 there didn’t seem to be anyone in charge. JP was running a humongous vampire squid of an organization wrapped around an absentee partner’s freighter ship. I don’t know whether he could have done well, and if he did do well it would only have hidden more of the central problem.
Yellen was not so tactical and evasive as Powell in her role as the Biden lapdog on the hunt with the climate crusades while ignoring her day job.