A New Leader — and a New Showdown — at the Fed

From New York [music] Times, I'm Michael. Barbaro. This is The Daily. >> [music]. >> On Wednesday afternoon, after a year of. harassing and threatening the chairman. of the most [music] powerful financial. institution in the country, President Trump finally [music] replaced. him. Sort of. Today, Colby Smith on how the president. [music]. ended one standoff at the Federal.

Reserve, only to create a new one. >> [music]. >> It's. >> [music]. >> Thursday, May 14th. The Ayes are 54, the Nays are 45. The. nomination is confirmed.

>> [music]. >> The president will be immediately. notified of the Senate's action. The Senate is confirming Kevin Warsh as. the next chair of the Federal Reserve. The move puts [music] President Trump's. pick in charge of interest rate policy. during a time of high prices and. economic uncertainty. Colby, we find ourselves in a very. curious place. Just a few hours ago, the US Senate. confirmed President Trump's choice to.

replace Jerome Powell as chairman of the. Federal Reserve. Powell, whom the. president has hated with the heat of a. thousand suns. And yet, Powell is refusing to entirely. cede the stage. Even though he's no. longer going to be chairman of the Fed, he's made this very surprising decision. to stay on at the Fed, not retire. And. it's created this totally unusual. scenario. Old and new Fed chairs trying.

to somehow coexist inside the Central. Bank in what is quite likely going to be. a very messy situation. So, talk us. through the events that got us. to this moment over the past few weeks. So, it's a really complicated moment for. the Federal Reserve. Jerome Powell's. decision to stay on at the Fed breaks. with really decades of tradition. The. last time this happened was in the late.

1940s, and that was at the request of. the president at the time, Harry Truman. So, this is obviously a very different. situation. As you said, Trump and. Powell, they've been at loggerheads for. most of Trump's second term, and I can't. remember a time in history in which a. Fed chair stayed on past the end of his. tenure when the president explicitly. didn't want him to. Mhm. >> [music]. >> We have. a fool at the Federal Reserve.

He's an absolute fool. And this whole decision stemmed from. [music] an extraordinary pressure. campaign launched by President Trump. against Powell and the Fed for Powell's. refusal to lower interest rates. Now we. have a man that just refuses to lower. the Fed rate. Just refuses to do it. And uh he he's not a smart person. And uh he's something wrong with him. He's just stupid. [music]. I I'd be honest, I'd love to fire his. ass. He should be fired. Guy's grossly.

incompetent. And it really took on a whole life of. its own. President Trump's. long-simmering war against Jay Powell, the Federal Reserve chair, it has. officially gone nuclear. One of. President Trump's top targets, the. chairman [music] of the Federal Reserve, is now under criminal investigation. The. investigation involves Powell's. testimony into the cost of building. renovations at the Fed. And it. culminated in this criminal. investigation launched by the Justice. Department against Powell and the Fed. over these renovations of its.

headquarters in Washington. And this in. a lot of ways just ended up backfiring. spectacularly [music]. against Trump. It looks fishy. Why do you say that? >> look great. If you wanted to design a system to. cause interest rates to go up and not. down, you would have the Federal Reserve. of the United States and the executive. branch of the United States get into a. pissing contest. I hope they have a. smoking gun or something because I don't.

think you trifle with the uh Federal. Reserve with the central bank. Because. the existence of this investigation. ended up becoming a big impediment to. Trump getting exactly what he's wanted. for a long time, which is Powell to. leave and for him to be able to put in a. new person as Fed chair. Right. And. Trump has, by this point, picked this. person he wants to be his new Fed chair, Kevin Warsh, whom Trump nominated as. this investigation drama is playing out.

Exactly. [music]. Until the investigation is resolved, I. cannot and I will not vote to support. anyone on the Federal Reserve in my. remaining tenure in the US Senate. And. what happened here is that Thom Tillis, [music]. a retiring Republican senator from North. Carolina, said he would not support any. of Trump's Fed nominees until the legal. threats into Powell had ended. >> Mhm. The problem that I have here is. that we had some US attorney with a.

dream or assistant US attorney thinking. it would be cute to bring Chair [music]. Powell under an investigation just a few. months before the position was going to. be open. And this was a really potent. [music] tool because Tillis had a. pivotal vote on the Senate Banking. Committee, which oversees the. confirmation process for Fed nominee. >> He literally [music] could block Trump's. pick to replace Powell. Exactly. Just. given the slim majority that Republicans. have, his opposition to allowing the.

confirmation process to proceed created. this blockade of sorts that put on pause. something that Trump had really really. wanted. Until the matter is solved, I'm. a no. >> [music]. >> And I think what's important to remember. about this is that the grounds of the. investigation were so spurious. It was. about this renovations project that had.

gone millions of dollars over budget, but cost overruns, they're not a crime. And I think it was clear from the very. get-go that this investigation was. really politically charged. >> This unprecedented action should be seen. in the broader context of the. administration's threats and ongoing. pressure. Powell says as much in this. extraordinary statement shortly after. the investigation went public. We talked. about it the last time I was on the. show. >> Right. This is about whether the Fed.

will be able to continue to set interest. rates based on evidence and economic. conditions or whether instead monetary. policy will be directed by political. pressure or intimidation. And a short. while later, we had a federal judge also. coming out strongly against the. investigation. This judge basically said. in no uncertain terms that this was. about pressuring and harassing Powell so. the president could install someone. who's more amenable to his demands. So, you had all of this opposition mounting.

to this investigation, and it was quite. clear it was on really shaky legal. footing. So, the question all along was. when would Trump blink? How long would. they continue to pursue an investigation. that really had no future, especially. when it was jeopardizing this thing that. Trump had long wanted? >> Right, suddenly Trump was being asked to. choose. between revenge against the Fed chair he. hates. and replacing. that Fed chair he hates. And. in this period you're describing,

he was kind of choosing revenge over. replacement. Absolutely. And there was a. time element here. Powell's term was up. May 15th, and they were running out of. time to get Trump's nominee, Kevin. Warsh, into that role. So, we're all waiting to figure out how. they're going to proceed here, and we. keep getting signs that they're nowhere. close to dropping this investigation. The chairman says, "No, no, you're. attacking the independence of the. Federal Reserve. That's not what we're. doing. We're doing our job." US Attorney.

for the District of Columbia, Jessie. Liu, who launched this investigation, continues to say she's pursuing this. investigation. Federal prosecutors made. an unannounced visit to the Federal. Reserve yesterday as part of their. investigation into Fed chair Jerome. Powell. What's the latest on that? >> Yeah, this was highly unusual. We're. Members of her team at one point went to. the Fed itself to try to visit the. active construction site and poke around. a little bit. There was just a lot of. mixed messages at this point, and it. started to impact, I think, how Powell.

began to speak about what he was going. to do at the Fed. I have no intention of. leaving the board until the. investigation is well and truly over. with transparency and finality. On the question of whether I will then. continue to serve as a governor after my. term ends and after the investigation is. over, I have not made that decision yet. Mhm. So, Powell has one tool of leverage. left in his arsenal. His term as chair. ends May 15th, but technically he can.

stay on as a member of the Fed's Board. of Governors. This is a seven-person. board who makes really important. decisions about interest rates and. policy and internal staffing decisions. at the Fed. So, it's an important. position. And Powell had been really. vague about what he planned to do. The. Justice Department is calling off one of. its most controversial investigations. >> Jeanine Pirro says she's dropping her. investigation. looking at J. Powell in the Federal. Reserve construction. And finally on.

April 24th, so just a couple weeks. before the end of Powell's term, Pirro. finally caves and announces that she's. dropping the case. >> Mhm. US Attorney Jeanine Pirro added, "I. will not hesitate to restart a criminal. investigation should the facts warrant. doing so." You just heard. >> She keeps open the option of starting it. again at any point, but she essentially. says that she's wrapping up her. investigation. She kind of hands off the.

job to the Inspector General at the Fed. I am prepared to move on with the. confirmation of Mr. Warsh. I think he's. going to be a great Fed chair. And that. outcome was sufficient for Tillis to end. his blockade against Trump's Fed nominee. Kevin Warsh, but it wasn't enough for. Powell. >> [music]. >> I welcomed the announcement last Friday. by the US Attorney for the District of. Columbia that she had closed the. criminal investigation.

She also noted, however, that she would. not hesitate to restart the. investigation. At the end of April, in. his last press conference as chair, Powell makes clear he is not convinced. whatsoever that the administration's. investigation is over. My decisions on. these matters will continue to be guided. entirely by what I believe is in the. best interest of the institution and the. people we serve. After my term as chair. ends on May 15, I will [music] continue. to serve as a governor for a period of. time. to be determined. And because of that, he is using his one tool of leverage.

He's going to stay on at the Fed. You. know, I'm literally staying because of. the actions that have been taken. I I. had long planned to be retiring. >> [music]. >> Uh and. you know, the things that have happened. in the really in the last 3 months have. I think left me no choice but to stay. until I see them through at least that. long. So, [music] that threshold for. Powell in terms of the investigation. being well and truly over with. transparency and finality, that's. definitely not reached. But, the bigger. reason he says is that Trump's [music].

ongoing attacks on the institution have. imperiled the Fed in a pivotal way. such. actions. I worry that these attacks are. battering the institution and putting at. risk the thing that really matters to. the public, which is the ability to. conduct monetary policy without taking. into consideration political factors. It is so important for our economy, for. the people that we serve, that they can. depend [music]. over time on a central bank that. operates that way, free of political. influence. It has risked the Fed. becoming more politicized, [music] and.

it has risked the US economy being. undermined. For him, it's not just about. him and his future and the. investigation, [music]. it's about the future of the central. bank and its ability to operate free of. political meddling. And how does staying on the Fed's Board. of Governors, but not leading it, in. Powell's mind, ensure that the Fed.

remains independent and can withstand. these attacks from the president? So, at. the most basic level, by staying on, Powell blocks Trump's ability to. nominate another person to the Fed's. Board of Governors. Now, this is. important because the more people on the. Board of Governors who are willing to do. the president's bidding, the more likely. it is that the institution becomes an. extension of the administration. Now, Trump, of course, had the ability to.

name a new Fed chair in replacing. Powell, but with Powell staying on, Trump would no longer be able to add. another governor. And so, what it. effectively did was reduce Trump's. influence over the board. And it's. really important to underscore that the. Board of Governors is really powerful. These policy makers are absolutely. pivotal in the direction of interest. rates, in the direction of bank. regulatory policy, in staffing changes.

inside the Fed, and also as it relates. to the regional bank presidents that sit. across the country. So, they play a. really crucial role in shaping how the. Fed operates. So, having a majority of. supporters on the board can really sway. the institution one way or the other. Because Powell linked his decision to. stay on the board to. the investigation into the Fed, I guess I have to ask, does a remaining in any way protect him.

from that investigation being reopened. legally? So, from a legal standpoint, staying on doesn't really change much in. terms of the investigation and his. ability to um be the subject of any kind. of criminal probe. On the margins, he is. conferred benefits and protection by. being a sitting governor. A president. can't just remove him at will. So, that. stands in his favor. But, what staying. on really shows is that this is bigger.

than the investigation itself. He really. believes this is about the institution, and the stakes are simply too high for. him to leave. >> Mhm. So, given that, the reality that. sticking around on the board doesn't. really offer much of a legal shield for. Powell, it seems we're pretty much. taking him at his word here that he. wants to stay on to more broadly protect. the Fed. from Trump's encroachments and keep the. Fed looking like basically Jerome.

Powell's version of the Fed. Right. And I think there's going to be this. tension right from the get-go where you. basically have Powell stepping down as. chair, moving his offices inside the. Fed's building a couple offices down. from his old one. This new guy coming. in, Kevin Warsh, and people really don't. know how it's going to work. Powell has. said he's going to keep a low profile as. a governor, but people are going to pay. attention to him when he speaks up. either inside the room ahead of rate.

decisions or if he ever makes a speech. publicly. It has all the makings of an. incredibly awkward environment where I. think people are not really going to. understand who is in charge at this. crucial moment for the central bank. And I think what adds to the awkwardness. here is that the person replacing. Powell, Kevin Warsh, is a huge critic of. him and everything he's done in his. tenure as chair. And he has gone so far.

as to call for regime change. And the. question on everyone's minds is how far. is he going to push it? >> [music]. >> We'll be right back. So Colby, tell us about Kevin Warsh, this incoming Fed chair, and the basis. for his critique of Powell and Powell's. Fed. So this is a bit of a homecoming.

for Warsh. He served as a governor at. the Fed between 2006 and 2011 and this. overlapped with the height of the global. financial crisis and he was pivotal in. crafting the Fed's response to that. moment. And that's where really the. source of his criticism against the. Central Bank started to brew. >> During this period? >> During this period. He ended up leaving. in 2011 over a disagreement about how. interventionist the Fed had become in. financial markets and in the global.

economy because of its response to the. financial crisis. What specifically was. his criticism of the Fed's intervention. starting after the financial crisis if. he himself was highly involved in it? So, if you think back to the 2008. crisis, banks weren't lending, you had. bank failures, it was a kind of a full. stop on the economy. So, the Fed, they. did two things. First, they drove. interest rates down to zero, but that. wasn't enough to stabilize things. So, they did something else highly unusual. at the time. They started buying up huge.

quantities of government bonds and. mortgage-backed securities. That. increased their portfolio of holdings, otherwise known as the balance sheet. And Warsh, he was on board for this. initial response, but from his. perspective, the Fed eventually took it. too far. And I think it's important to look at. the numbers here because before the 2008. financial crisis, the Fed's balance. sheet was less than a trillion, and by. the end of the crisis, it was over 4. trillion. Wow, so. 4x. >> Exactly. And it got even bigger. And.

this is the crux of his criticism about. the Fed as it stands today. After the. pandemic, the balance sheet peaked at. close to 9 trillion dollars. It's now. somewhere around 6 and 1/2 trillion. And. for Warsh, the balance sheet, it's. really emblematic of everything that has. gone wrong at the Central Bank since he. left it. The Fed balance sheet has played a. particularly, I think, unhelpful role in. In his recent Senate confirmation.

hearing, he says that there are several. reasons why this tool is problematic. First and foremost, he makes the case. that expanding the balance sheet is. actually bad for the US economy. He says. it exacerbates inequality. The Fed has. an interest rate tool and a balance. sheet tool. My view is the interest rate. tool gets in the cracks. It's fairer. The balance sheet tool. disproportionately helps those with. financial assets. The interest rate tool. hits the entire economy. And he also. warns that it risks making inflation.

worse. Had the balance sheet not been. brought from the $800 billion level when. I showed up at the Fed in 2006 to an. order of magnitude higher, I think interest rates could be lower, inflation could be better, and the. economy could be stronger. But his. critique, it goes beyond economics. The. big balance sheet has become an ordinary. recurring force, and I think it's been. quite unhelpful, and it's part of the. reason why the Fed is in the business of. politics. He also thinks that when the.

Fed does this kind of stimulus, it. creeps outside of its congressional. mandate. And he says that when the Fed. does this, it potentially threatens the. Fed's credibility and its independence. We're going to have to find our way in. which we can take the balance sheet and. make it smaller because a large balance. sheet where the Fed owns more uh. outstanding debt than many parts of. [music] the financial markets, that's. fiscal policy in disguise. That needs to.

get out of the fiscal business, focus on. the monetary business so the Fed can. deliver on the remit you gave us. >> [music]. >> So when Warsh talks about regime change, a big part of what he means by that is. redefining how the Fed should operate in. the economy and the global financial. system. What he's trying to do here is to. minimize, I think, how interventionist. the Fed really is in a lot of ways. And. for him, that would not only reduce the.

degree of economic harm caused by the. central bank, but it would also rein in. this mission creep that he sees as a. threat to the Fed's institutional. credibility. Mhm. Simple question, is Warsh right? And let. me get even more specific. Is he right. about inflation we are living through. still a rather inflationary era in. American financial life? So, is he correct that the Fed played a role. in creating that? So, I think it's a. complicated answer, unfortunately, because there were a lot of reasons to.

explain the high inflation environment. that we're in today. So, for Warsh, he. has in hand a very clear example of how. the Fed's overreach has created. inflation and caused distortion in. financial markets. And he points to the. pandemic in 2020. The Fed steps in. forcefully. It lowers rates to zero. It. starts buying unlimited government. bonds. And the response eclipsed. anything that we saw during the 2008. global financial crisis. >> Mhm.

And for Warsh, the problem was is that the Fed kind of. continued this extraordinary support for. too long. And even some officials at the. Fed have kind of come around to this. idea that they could have stopped buying. bonds earlier. And I think that is because this episode. created the worst inflation that we had. seen in four decades. And that all. happened under Powell's watch. For. supporters of Powell, there are other things that you can. point to to explain this inflation.

situation. >> Such as, because we covered it, President Biden's large stimulus who. wrote checks to Americans during the. pandemic. Exactly. There was an. exorbitant amount of support provided to. Americans at a time, and this is perhaps. most important, that supply chains were. shuttered. So, you had all of this. demand with constrained supply, and this. mismatch created higher prices. Higher. prices. And so, this became the kind of. opening, I think, for critics against. Powell and the Fed to say that he had.

led the institution astray. And what. about Warsh's kind of secondary critique. here, which is that through these huge. interventions, Powell's Fed has overstepped its role in. a way that's just bad for everybody. Is. that view widely held? So, it's an. argument that has definitely gained. traction. We've heard something similar. from Treasury Secretary Scott Bessent, specifically as it relates to the. balance sheet and some of the. interventions into financial markets.

that the Fed did back in 2020. But, I'm not really sure it carries much. weight inside the Central Bank. They. argue that this balance sheet tool was. absolutely crucial to getting the. financial system functioning again and. ensuring the economic recovery in the. aftermath of the crisis. So, that's Warsh's broad critique of. Powell's Fed. It obviously appeals, as. you said, to Trump. But, how does. Warsh's view of the Fed.

line up with Trump's determination. to cut interest rates? There's an. assumption out there that Trump would. never replace Powell with anyone who. wasn't going to cut the interest rate. because that's in such a singular way. what Trump wanted and Powell refused to. deliver. So, what is Warsh saying about. that? So, what's really interesting. about Warsh is that his whole history as. someone who's been highly skeptical of.

lower rates. >> Mhm. And he's someone who was kind of. branded as this inflation hawk. Someone. who was incredibly worried about price. pressures in the economy and always. wanted the Fed to keep in mind the risks. of higher inflation. And what that. typically resulted in is him pushing. back on the need for the Fed to cut. interest rates more than anything else. And that's something that he he been. consistent on basically up until the. point that he started to be considered.

to become Powell's replacement. >> Mhm. And then what happened? >> And then we start to see a shift in tone. from him. He comes up with all these. different reasons why interest rates. should be lower. And this marked a real. flip-flop um given his past stance. And. it started to raise these questions. among people who watch the Fed closely. about what was behind this seeming. flip-flop from Warsh. People started to. ask whether this was politically. motivated, and perhaps this was why. Trump chose him to be his nominee to.

replace Powell. Right. How much does Powell remaining on the. Board of Governors, to bring us back to the first part of. our conversation, how much harder is that going to make it. for Warsh to cut interest rates if he. wants to in fact do that in the coming. months or years? I think actually it's not necessarily so. much about Powell staying here, but the. economic environment completely shifting. against the need for cuts in the last. couple of months. So, Powell's presence.

in and of itself certainly does not help. because he is someone who does not see. an urgent need for the Fed to lower. interest rates. And this is someone who. obviously is respected across the. committee, so his views on that matter. But, cutting rates at this time would be. economically disastrous according to. most officials at the Fed. They see. inflation risks rising because of this. war. We have no idea when that's going. to end. Oil prices are higher, and this. is not an environment where lower.

interest rates are going to help. whatsoever. If anything, it's going to. make things worse. And so, this puts. Warsh in an incredibly uncomfortable. position. His first meeting as chair is. going to be in June, and no one expects. him to be able to push through interest. rate cuts at that moment. People don't. even actually know if he is going to. pursue that because doing so would. undermine his credibility so directly. Mhm. Because the economic environment. does not call for cuts, him supporting.

that would look like he was the. president's policy lapdog. >> Exactly. And he spent his entire. confirmation hearing basically trying to. disabuse lawmakers of the notion that he. was going to operate as Trump's sock. puppet. This is this big credibility. issue that's going to loom large over. him. And he's going to be faced with. this choice come that first meeting. Does he. establish his own credibility and risk. angering the president or does he do.

what the president wants him to do and. then internally his own credibility is. undermined? Fascinating. And. what do we suspect he will do? I think. Warsh has made clear that he is someone. who does not like inflation. That I just. don't think that we're going to see him. depart from that so dramatically. No Fed. chair wants to be remembered as. a Fed chair who led the economy down a. bad path. And that's going to I think.

going to be the thing that continues to. kind of moderate how he behaves and what. he ends up pursuing in terms of rates. >> Well, what you're outlining is that. Kevin Warsh, despite all his promises of. delivering change at the Fed, is going to find himself taking a. Powell-like position on interest rates, resisting the president's demands to cut. them, and becoming Powell-like in. the fact that the president's going to. become furious with him that he's not. getting the job done. Yes, exactly. I. think that the big question for everyone.

is just how much runway is Trump going. to give his Fed chair pick. Is he going. to give him a couple of months to settle. in and establish his own credibility and. give him the okay to not necessarily. vote for lower interest rates or is he. going to come right out of the gate and. attack him for not being able to deliver. the thing that he has kind of made clear. was the precondition for whoever he was. going to give the job to. And I think. this is really going to come to a head. as early as mid-June, which is the first.

meeting that Warsh is going to preside. over as chair. And we could be in a. situation where Warsh is voting. alongside Powell to hold rates steady, and that's not going to look like the. regime change that he talked about. And. that would start to perhaps change. Powell's calculation. >> [clears throat]. >> No, about staying on the board because. suddenly he will have the knowledge that. the person replacing him is not there to.

blow up the Fed and remove its. independence. Does that make him perhaps over time. question staying on the board? So, I. think his decision is just bigger than. that. This is really fundamentally going. to come down to his perception of the. threat posed by President Trump on the. institution. This is ultimately going to. be about whether or not Trump ceases his. attacks against the central bank and. allows it to do its job, or if he.

continues them. And if Trump decides to. turn on Warsh. or continues his attacks on other. officials, all that's going to do is. >> is reaffirm. Exactly, and it's going to. keep motivating Powell to stay on. And. at this point, he's made the hard. decision already to stay. Well, let me. end with a question about Powell and his. decision to stay on the board. Because. it from what you're saying, even if. Warsh ends up being an ideological. fiscal ally, he's going to stay on. anyway. And he's going to keep arguing the.

reason he's staying is to protect the. Fed from politics. But by staying. in a way that his predecessors. for the last. many decades have not, does he risk himself politicizing. the Fed? Because staying on to fight the. president is ultimately, whether you. agree with it or not, a political. decision. It might be a principled. decision, but ultimately a political. one. Is he making the Fed more political.

by doing this? I think that's exactly. the criticism that Powell is opening. himself up to, and I think he's aware of. it. I mean, he was pressed at his final. news conference about exactly this. issue. By remaining on the board, you're. actually taking a political act in. denying. uh President Trump the majority of the. board, which as president he would have. if you left. I I don't see that at all. I As I. mentioned. >> pushed back on that characterization. I don't see how this will interfere. I'm. not My intention is not to interfere. You know, I was a governor for almost 6.

years. And the tradition is at the Fed. that governors uh who understand how. difficult the role of chair is, and as a. as a soon-to-be former chair, I do. understand how hard it is to get. consensus with 19. >> But the the fact that the. administration's actions are influencing. his decision to stay or go really has. kind of changed the nature of what. previously was a very kind of mundane. personnel process that occurred at the.

Fed. >> you try to uh. collaborate with the chair and try to. support the chair when you can. When you. can't, you can't. And I think that's the. attitude that people generally take, and. that's the attitude that I'll take. Now. suddenly, that is going to cast on to. other policymakers at the Fed who are. thinking about leaving or staying. If. you leave, does that mean that you are. creating an opening for the president to. put someone else in there that's going. to lead the institution in the wrong. direction?

>> a little bit like the Supreme Court. >> Exactly. And And I think that the fact. that, you know, people are gaming all of. these things out just shows the way in. which that politics has infiltrated the. central bank because of these attacks. from the president. >> Right. There really isn't any going back. from this. Exactly. >> [music]. >> It'll be interesting to see how Warsh. kind of deals with that pushback if he. eventually gets it from the president.

and [music] ultimately like how much of. a bullwark he himself is going to be in. protecting [music] his own independence. to do his job. Kobie, thank you very much. Thanks so. much for having me. We'll be right back. >> [music]. >> Here's what else you need to nerd out. On Wednesday, the US Senate blocked.

Democrats' seventh attempt to halt the. war in Iran and require congressional. approval for it to continue. >> [music]. >> But, a Republican defection signaled the. party's growing impatience with. President Trump over the war. For the first time, Republican Senator. Lisa Murkowski [music] of Alaska joined. Republicans Susan Collins of Maine and. Rand Paul of Kentucky in voting with. Democrats.

>> [music]. >> In the end, a Democratic Senator, John. Fetterman of Pennsylvania, crossed party. lines to cast the decisive vote to. [music] block the measure. And, South Carolina's [music] Supreme Court. has overturned the murder convictions. against Alex Murdaugh, a lawyer found. guilty of murdering his wife and one of. his sons in a 2023 trial that [music]. captivated the country. The court said that interference by a.

court clerk [music] involved in the. murder trial meant that Murdoch's. conviction must be voided and a new. [music] trial be held. Jurors in the original trial said the. clerk made prejudicial comments to them. about [music] Murdoch. Despite the ruling, Murdoch will remain. in prison because he pleaded [music]. guilty to different crimes, including. stealing money from his law firm and his. clients.

Today's [music] episode was produced by. Mary Wilson, Lexie Diao, and Ricky. N'Guessan. It was edited by Mark George with help. [music] from Lisa Chow and contains. music by Mary Lozano, Rowan Nemi, Pat McCusker, and Dan Powell. Our theme music [music] is by Wonderly. This episode was engineered by Alyssa. Moxley. >> [music]. >> That's it for The Daily. I'm Michael.

Barbaro. See you tomorrow. >> [music].