U.S. Treasury hobbled by Cruz's nomination holds, officials say
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[October 12, 2021]
By Andrea Shalal
WASHINGTON (Reuters) -The U.S. Treasury is
being held hostage by Republican Senator Ted Cruz's efforts to halt a
Russia-to-Germany gas pipeline, blocking critical appointments when the
federal debt limit remains a pressing issue, White House officials and
Democrats in Congress say.
Only four confirmed nominees are in place in the top ranks of the
Treasury, of about 20 slots for presidential picks, officials say. More
than eight months after Democratic President Joe Biden took office, his
nominees across the government are being approved at a slower rate than
the past three presidents, federal data shows.
In addition to the toll that Cruz's actions are taking on the Treasury's
ability to tackle the federal debt limit, they are hurting the Biden
administration's ability to address other big problems, senior officials
say, including a global minimum tax, terrorism and financial
intelligence.
Cruz has wielded power by being a lone holdout on a fast-track
confirmation process that requires consent by all 100 senators for
non-controversial nominees - a description the White House says fits
many of the Treasury picks as well as others awaiting Senate
confirmation, including numerous ambassadors.
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Cruz wants Biden to impose sanctions that would halt Russia's Nord
Stream 2 gas pipeline.
Biden, despite his opposition to the pipeline, has said he waived
sanctions because the project was nearly complete and he wanted to
rebuild strained ties with Germany, a key U.S. ally.
As far as Cruz is concerned, a spokesman for the senator said, the
solution is simple: he will remove the holds if the Biden administration
sanctions the company behind the pipeline project, something he insists
is required under U.S. law.
Failure to do so "hands Vladimir Putin a geostrategic victory" and
"entrenches corrupt Russian influence in Europe" Cruz said in a letter
on Sept. 13, referring to the Russian president.
The Senate could go ahead with the confirmations by holding floor votes
in a time-consuming process that requires approval from 60 senators, but
that would limit the chamber's time to address other issues, including
efforts to pass infrastructure and spending bills, experts say.
The standoff has left some Treasury nominees, including Brian Nelson,
who is tapped to be undersecretary for terrorism and financial
intelligence, in limbo as the United States grapples with the Taliban
takeover of Afghanistan.
Others, including Jonathan Davidson, nominated to be assistant secretary
for legislative affairs, and Ben Harris, nominated to be assistant
secretary for economic policy, are working as advisers to Treasury
Secretary Janet Yellen and Deputy Treasury Secretary Wally Adeyemo in
the interim, but are severely constrained in what they can do.
If confirmed, Davidson would play a key role in building support for a
longer-term increase of the $28.4 trillion U.S. debt limit, and a global
minimum tax. But in his current role as a counselor he cannot engage in
"outward-facing" activities, according to federal guidelines, meaning he
cannot go to Capitol Hill to meet with lawmakers or make calls to them,
which some members of Congress say was a huge hurdle during the recent
debt negotiations.
While an agreement to raise the debt ceiling temporarily was reached
last week, there are no signs that Yellen will have a bigger team in
place to manage the issue when it bubbles up again in coming weeks, said
one official.
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![](../images/101221PIX/news_J19.jpg)
U.S. Senator Ted Cruz (R-TX) addresses a news conference on Capitol
Hill in Washington, U.S., October 6, 2021. Picture taken October 6,
2021. REUTERS/Evelyn Hockstein/File Photo
![](../images/ads/current/centraldirect_lda_SPONSOR_2021.png)
Personal efforts by Yellen and Adeyemo to get Cruz to
loosen his grip have failed, officials say, and they see no solution
in sight.
"Jonathan Davidson has widespread support as a
long-time Senate staffer, and is sorely needed as Congress navigates
numerous issues with the Treasury Department," said Senate Finance
Committee Chairman Ron Wyden, citing the federal debt limit
specifically. "Senator Cruz is just ... making it more difficult to
run the federal government well."
Cruz's spokesman did not address Wyden's comments, but said the
Texas senator would use "whatever leverage he has as a senator to
force President Biden to implement mandatory sanctions on Nord
Stream 2."
In the past, Cruz has released a small number of nominees who he
said were "cleaning up" foreign policy "messes" caused by the Biden
administration, and is not blocking the nomination of Graham Steele,
Biden's nominee to be assistant secretary for financial institutions
at Treasury, the spokesman added.
As of Thursday, the Senate had confirmed 191 of Biden's nominees, or
about 36%, compared with 42% of Donald Trump's over the same period,
68% of Barack Obama's and 65% of George W. Bush's, federal data
show.
MEETINGS WITH CRUZ
Yellen and Adeyemo have spoken with Republican senators in recent
weeks in efforts to get Cruz to drop his hold, a senior
administration official told Reuters. Treasury officials have also
asked other senators to appeal to Cruz, including Republicans Mike
Crapo and Cynthia Lummis, although both declined, the official
added.
Adeyemo gave Cruz an in-person classified briefing on Nord Stream 2
in recent weeks, a senior official said, and made another rare
in-person visit to Cruz's office.
Another Treasury official provided a classified briefing to
Republican Senator Pat Toomey, according to Toomey's office.
![](http://archives.lincolndailynews.com/2021/Oct/12/images/ads/current/collins_lda_PPP_2021.png)
"Both the secretary and Wally spoke with Cruz multiple times. We've
reached out to staff. We've tried every which way possible," said
the senior official, adding that the administration was losing hope
it could change his mind.
Treasury spokesman John Rizzo said it was "essential" that the
Senate confirm the nominees, calling them "critical" to the
department’s work to deal with the debt limit and "achieve national
security objectives of disrupting illicit finance and combating
terrorism."
(Reporting by Andrea Shalal; Editing by Heather Timmons, Leslie
Adler and Paul Simao)
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