Richmond Fed President Thomas Barkin participates in a fireside chat at the Conference Board at 9 a.m. … Philip Lane, an executive board member of the European Central Bank, will speak at a Peterson Institute for International Economics event at 9 a.m. … The House Financial Services Committee holds a hearing on community banking at 10 a.m. … Senate Banking will hold a “debanking” hearing at 10 a.m. … The Senate Small Business and Entrepreneurship Committee will mark up former Georgia Sen. Kelly Loeffler’s nomination to lead the Small Business Administration at 10 a.m. … Chicago Fed President Austan Goolsbee will speak at the hybrid 31st Annual Automotive Insights Symposium at 1 p.m. … Fed Gov. Michelle Bowman will address the Kansas Bankers Association at 3 p.m. … Fed Vice Chair Philip Jefferson will give a lecture at Swarthmore College at 7:30 p.m. … Treasury defends DOGE access to payments — The Treasury Department says that Elon Musk’s team currently has “read-only” access to the system that controls trillions of dollars in federal payments and that their work “is not resulting” in any suspensions of or delays to disbursements approved by federal agencies, Michael reports. In letters to Sens. Ron Wyden and Elizabeth Warren, the agency confirmed for the first time on Tuesday that Musk ally Tom Krause, the CEO of Cloud Software Group, was coordinating the “operational efficiency assessment” of Treasury’s payment systems as a special government employee. The agency said he went through the typical hiring process, is subject to ethics requirements, and has a Top Secret security clearance to handle sensitive data. The letter, which was signed by Jonathan Blum, who is now Treasury’s principal deputy assistant secretary for legislative affairs, was the first public statement from the agency amid a firestorm over the extent to which Treasury Secretary Scott Bessent gave Musk aides’ access or control over the federal payment system and the sensitive personal data contained within it. DOGE’s “ongoing review of Treasury’s systems is not resulting in the suspension or rejection of any payment instructions submitted to Treasury by other federal agencies across the government,” Blum wrote. “In particular, the review at the Fiscal Service has not caused payments for obligations such as Social Security and Medicare to be delayed or re-routed.” Senate Democrats, who’ve assailed Musk’s efforts to take control of vast swaths of the federal government in recent weeks, say they’re not satisfied with Treasury’s first explanation. “I’m sure the Treasury Secretary and the president want to save face and downplay the risks as Elon Musk seizes power, but nothing they’re saying is believable or trustworthy,” Wyden said. Warren said Treasury’s response “raises more questions than answers” and wants Bessent to “explain how this incursion was authorized, who had or has access to critical Treasury systems, and what protections are in place to protect the economy, national security, and Americans’ private data.” The two lawmakers, who are the top Democrats on the committees overseeing Treasury, are also seeking a Government Accountability Office investigation into the situation, as Michael also reported. Speaking of DOGE, progressives think Musk can play the villain in Trump 2.0 — As the influence of Musk’s DOGE network fans across Treasury and other federal agencies, Groundwork Collaborative and Public Citizen are circulating a new poll to Democratic lawmakers that suggests Musk’s influence has turned off voters. A Hart Research poll of 1,735 voters taken between Jan. 24 and Jan. 30 found that a majority — including 54 percent of independents — have a negative view of Trump’s billionaire government-efficiency adviser. A majority of those surveyed also said they were less favorable to Musk because of DOGE’s access to records and technology systems. “We expect that concern about this will grow significantly as voters learn about Musk gaining access to the government’s most confidential payment records,” Hart Research’s Geoff Garin, Abigail Davenport and Aileen Cardona wrote in a memo that was sent to Democratic senators on Tuesday evening. The poll suggests that targeting Musk “moves the needle significantly — raising his negatives with voters overall, including independents and key segments of Republicans.” — Sam Sutton Republicans zero in on ‘debanking’ — Hill Republicans are set to kick off a pair of hearings today that will put new scrutiny on allegations that Wall Street firms have inappropriately cut some customers off from financial services. The push to examine “debanking” has gained new steam in recent months due to complaints from key players in the crypto industry who say some digital asset firms have been cut off from banking services due to the actions of regulators during the Biden era. The focus is adding momentum to a GOP-led push to enact “fair access” legislation that would prescribe when banks can decline to serve certain customers. Now, the lawmakers who have led the charge on the issue — Rep. Andy Barr and Sen. Kevin Cramer — are both re-introducing fair access legislation, which has a better chance than ever of moving. Barr’s new bill, reported first by POLITICO, largely mirrors Cramer’s, with one distinction: It would apply to firms with over $50 billion in total consolidated assets, while the Senate version would subject banks with over $10 billion in assets to the regulation. Banks have fought fair access regulations in the past, but both lawmakers have said in recent weeks that Wall Street firms are now more open to their legislation, which is aimed at preventing politically controversial businesses such as crypto firms, gun manufacturers and fossil fuel companies from being blocked from banking services.
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