CBS News
FDIC head stepping down after report on agency’s workplace culture, White House says
The White House said Monday that the chairman of the Federal Deposit Insurance Corporation will step down, a departure that follows the release of a damning report about the agency’s toxic workplace culture.
The White House said Martin Gruenberg will step aside once a successor is appointed, and that President Biden will name a replacement “soon.” The announcement came after the top Democrat on the Senate Banking Committee earlier Monday called for Gruenberg’s removal.
Mr. Biden expects the FDIC “to reflect the values of decency and integrity and to protect the rights and dignity of all employees,” Deputy Press Secretary Sam Michel said in a statement.
Kevin Lamarque / REUTERS
Gruenberg has held positions in various levels of leadership at the FDIC for nearly 20 years, and this was his second full term as FDIC chair. His long tenure at the agency made him largely responsible for its toxic work environment, according to the independent report outlining the agency’s problems.
The 234 page report released Tuesday by law firm Cleary Gottlieb Steen & Hamilton cites incidents of stalking, harassment, homophobia and other violations of employment regulations, based on more than 500 complaints from employees.
The report says the agency fostered a workplace rife with harassment and bullying that mostly targeted women or people from underrepresented groups.
“[F]or far too many employees and for far too long, the FDIC has failed to provide a workplace safe from sexual harassment, discrimination and other interpersonal misconduct,” the report said.
Employees harbored a fear of retaliation that dissuaded them from reporting misconduct, and the report noted that one worker said they were contacting the law firm by using a VPN and someone else’s email because of their fear that senior executives would learn about their complaint.
Among the misconduct outlined in the report:
- One female worker said she feared for her physical safety after a colleague stalked her and continued to text her, including sending texts with partially naked women engaging in sex acts, even after she made a complaint about him.
- A male supervisor in a field office routinely talked about his female employees’ breasts and legs, as well as his sex life.
- A senior bank examiner send a text of his genitals out of the blue to a woman examiner while she was serving on detail in a field office.
- Workers who are part of underrepresented groups were told by colleagues that they were “only hired” because of they were members of those groups, and told they were “token” employees hired to meet a quota.
Gruenberg was also taken to task in the report, citing employee reports that he sometimes lost his temper and treated workers in a “demeaning and inappropriate manner.”
The findings about the FDIC’s workplace culture comes after the Wall Street Journal published a November investigation that alleged male employees at the agency engaged in harassment, such as sending lewd photos to female employees, yet still kept their jobs.
The FDIC is one of several U.S. banking system regulators. The Great Depression-era agency is best known for running the nation’s deposit insurance program, which insures Americans’ deposits up to $250,000 to protect them if their bank fails.
Before Monday, no Democrats had called for Gruenberg’s ouster, although several came very close to. But Ohio Sen. Sherrod Brown, the top Democrat on the Senate Banking Committee and who is facing a tough reelection campaign, issued a statement Monday calling for Gruenberg to step down, saying his leadership at the FDIC could no longer be trusted.
Gruenberg was grilled for two days last week on Capitol Hill in hearings largely focused on the FDIC’s workplace culture and the failures disclosed in the report prepared by an outside law firm.
“After chairing last week’s hearing, reviewing the independent report, and receiving further outreach from FDIC employees to the Banking and Housing Committee, I am left with one conclusion: there must be fundamental changes at the FDIC,” Brown said in a statement.
Republicans have been calling for Gruenberg’s ouster for some time and criticized the White House for not calling for his immediate departure.
— additional reporting by Aimee Picchi.
Frito-Lay is recalling a limited number of 13 oz. bags of Lay’s Classic Potato Chips after being alerted by a consumer contact that the product may contain undeclared milk.
The bags of chips affected by recall were distributed to certain retail stores and e-commerce distributors in Oregon and Washington and were available for sale beginning Nov. 3, 2024.
“Those with an allergy or severe sensitivity to milk run the risk of a serious or life-threatening allergic reaction if they consume the recalled product,” the Food and Drug Administration said in the recall notice posted Thursday.
No allergic reactions related to the recall have been reported, according to the recall. Additionally, no other Lay’s products, flavors, sizes or variety packs are affected.
FDA
The recalled chips include Lay’s Classic Potato Chips, in flexible 13 oz. (368.5 grams) bags with UPC code 28400 31041, a “Guaranteed Fresh” date of 11 Feb 2025, and one of either two manufacturing codes: 6462307xx or 6463307xx.
General guidelines from the FDA advise consumers who have purchased any recalled food to dispose of the product or return it to the retailer for a full refund.
Watch CBS News
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
CBS News
What is the debt ceiling? Here’s why Trump wants Congress to abolish it before he takes office
Washington — President-elect Donald Trump, Vice President-elect JD Vance and billionaire Elon Musk blew up a GOP-backed deal to fund federal agencies into March, raising the pressure on Republican congressional leaders to craft a plan to avert a government shutdown just before the holidays.
In a statement Wednesday, Trump and Vance lambasted the agreement for including provisions favored by Democrats. But the incoming president and vice president also added a new, significant wrinkle to negotiations when they urged Congress to raise or abolish the debt ceiling now, instead of next year.
“Increasing the debt ceiling is not great but we’d rather do it on Biden’s watch,” Trump and Vance said in their statement. “If Democrats won’t cooperate on the debt ceiling now, what makes anyone think they would do it in June during our administration? Let’s have this debate now.”
What is the debt ceiling?
Set by Congress, the debt ceiling, or limit, is the maximum amount of money the U.S. Treasury is authorized to borrow to pay debts incurred by the federal government. Lifting the debt ceiling does not authorize new spending, but instead lets the government spend money on obligations that Congress has already been approved.
Failing to address the debt ceiling could lead the U.S. to default on its debt, which would have devastating effects on the economy. The government has never defaulted, and the Treasury typically uses accounting moves, known as “extraordinary measures,” to delay breaching the debt ceiling.
While raising the debt ceiling used to be routine, legislation addressing it has in recent years been used as leverage to force policy concessions and fuel debates over government spending.
Congress last addressed the debt ceiling in June 2023 as part of a legislative package negotiated by President Biden and then-House Speaker Kevin McCarthy. That deal suspended the debt ceiling through Jan., 1, 2025, ensuring any fight over it would take place after the 2024 elections.
The Treasury Department will likely implement extraordinary measures to stave off a default in the new year. It will also announce an “X date,” the estimated point at which the government will no longer be able to pay its obligations. The Economic Policy Innovation Center, a conservative think tank, projected in an analysis released Monday that it’s possible the debt limit will be reached by June 16.
While the Treasury Department’s use of extraordinary measures would give Congress more time to address the debt ceiling, Trump is now urging lawmakers to take action now, before he takes office.
Why does Trump want to raise the debt ceiling?
The president-elect will come into office with a legislative to-do list that includes securing the border and extending provisions of his signature Tax Cuts and Jobs Act, which was enacted in 2017 and overhauled the tax code. But a fight over the debt ceiling could complicate efforts by the Republican-led House and Senate to focus on those legislative initiatives and pass them quickly.
Trump is urging lawmakers to eliminate the debt ceiling altogether, a position that some prominent Democrats have endorsed in the past.
“Number one, the debt ceiling should be thrown out entirely,” Trump said in a phone interview Thursday with CBS News’ Robert Costa. “Number two, a lot of the different things they thought they’d receive [in a recently proposed spending deal] are now going to be thrown out, 100 percent. And we’ll see what happens. We’ll see whether or not we have a closure during the Biden administration. But if it’s going to take place, it’s going to take place during Biden, not during Trump.”
Trump separately told ABC News that “there won’t be anything approved unless the debt ceiling is done with,” indicating any spending deal to prevent a shutdown must address the debt limit.
“If we don’t get it, then we’re going to have a shutdown, but it’ll be a Biden shutdown, because shutdowns only [injure] the person who’s president,” he told ABC News.
Whether Republicans and Democrats would go along with such a plan, though, is far from clear. GOP lawmakers in both chambers have opposed raising the debt ceiling without spending reforms, and debates over the debt limit often give way to broader fights over the federal budget, which conservatives in Congress have said is bloated and should be reduced. Plus, Democrats still control the Senate and the White House.
White House press secretary Karine Jean-Pierre said in a statement Wednesday that shutting down the government would harm families and endanger services Americans rely on.
“Republicans need to stop playing politics with this bipartisan agreement or they will hurt hardworking Americans and create instability across the country,” she said. “President-elect Trump and Vice President-elect Vance ordered Republicans to shut down the government and they are threatening to do just that — while undermining communities recovering from disasters, farmers and ranchers, and community health centers.”
House Democratic Leader Hakeem Jeffries suggested Democrats would not go along with a plan pushed by Republicans to raise the debt limit.
“GOP extremists want House Democrats to raise the debt ceiling so that House Republicans can lower the amount of your Social Security check. Hard pass,” the New York Democrat wrote on the social media platform Bluesky.
Jeffries also told reporters “the debt limit issue and discussion is premature at best.”
