Trump to Nominate Federal Reserve Board Critic Stephen Moore for a Seat on the Board
Donald Trump said he’s nominating Stephen Moore, a visiting fellow at the Heritage Foundation and a long-time supporter of the president, for a seat on the Federal Reserve Board.
Trump made the announcement Friday to reporters traveling with him to Palm Beach, Fla., confirming an earlier Bloomberg News report. The president later said in a tweet that Moore is “a very respected Economist” and said he has “no doubt he will be an outstanding choice.”
Moore has emerged as an ardent critic of the Federal Reserve Board under its current chairman, Jerome Powell, who fell out of favor with Trump last year after the Fed’s rate increases. Placing him on the board may be the president’s attempt to check Powell and head off further tightening of U.S. monetary policy that Trump believes could slow economic growth before his 2020 re-election campaign.
“The only thing he told me was to pursue policies that are good for the American economy and for American workers,” Moore said of Trump in an interview on Bloomberg Television. “He didn’t mention anything about differing with Chairman Powell.”
Moore, who isn’t a Ph.D. economist but holds a master of arts degree in the discipline, got on Trump’s radar with a March 13 Wall Street Journal column he co-authored that championed Trump’s policies and blamed the Fed for slowing the economy. Trump’s chief economic adviser Larry Kudlow showed the op-ed to Trump over lunch last week, according to two people familiar with the matter.
Trump remarked to Kudlow that he should have appointed Moore to be Fed chairman, the people said, and directed Kudlow to call Moore and gauge his interest in a board seat. This week, Trump called Moore himself and asked if he’d accept a nomination to the board.
In the op-ed, Moore also suggested the Fed stabilize the value of the dollar by adopting a commodity price rule. He has harshly criticized Powell and the current Fed board in other recent public remarks.
“I believe the people on the Federal Reserve Board should be thrown out for economic malpractice,” Moore said Dec. 22 on Red Apple Group chairman and chief executive John Catsimatidis’s radio show, blaming an end-of-the-year stock market swoon on the Fed’s rate hikes.
“Janet Yellen couldn’t have been any worse than the guy he’s got in there now,” Moore said of Powell and his predecessor. “I always thought he was a bad choice. He’s been a Fed guy for many years. Donald Trump wanted to drain the swamp. The Fed is the swamp.”
Moore was a fierce critic of Trump’s predecessor, Barack Obama. Moore predicted rising budget deficits under Obama would lead to higher interest rates and inflation, but that didn’t come true. Under Trump, the budget deficit is on pace to exceed $1 trillion this fiscal year.
Moore is a former Trump campaign adviser who helped write its economic agenda and a close friend of Kudlow. He was a senior economist on the Congressional Joint Economic Committee, served on the editorial board of the Journal and was an economic analyst for CNN.
Also under consideration for the board is Herman Cain, the former pizza company executive who ran for the 2012 Republican presidential nomination, according to the people, who asked not to be identified discussing Trump’s private deliberations.
Moore advised Cain on his so-called “9-9-9” tax plan in 2011, which would have replaced much of the U.S. tax code with a flat 9% tax on sales transactions as well as corporate and individual income.
There are two vacant seats on the Fed board.
Bloomberg News previously reported that Cain, 73, was under consideration. Yet his nomination would raise the prospect of a Senate confirmation hearing focused on the sexual harassment accusations that ended his presidential campaign. While he remains in the running, there are concerns in the White House about whether he could clear the confirmation process, according to a person familiar with the matter.
Cain last September co-founded a pro-Trump super-political action committee, America Fighting Back PAC, which features a photo of the president on its website and says: “We must protect Donald Trump and his agenda from impeachment.”
He has had a long corporate career, and from 1992 to 1996 he served as a director of the Federal Reserve Bank of Kansas City, as well as deputy chairman and later chairman. He advocated for the U.S. to return to the gold standard during his presidential campaign and as recently as December 2017 defended higher interest rates, a position that contrasts with Trump’s repeated criticisms of the Fed last year.