US economy

Trump’s Fed Nominee Has Burned Bridges But Made Few GOP Enemies


© Bloomberg. Stephen Moore Photographer: Andrew Harrer/Bloomberg

(Bloomberg) — President Donald Trump’s pick for an open Federal Reserve board seat, Stephen Moore, has sharply criticized some of the Republican senators whose votes he’ll need for confirmation. Yet that hasn’t made him many enemies.

“I’ve known him a long time and expect to support him,” said Tennessee Senator Lamar Alexander, who Moore once lambasted as a “turncoat” Republican for not backing a full repeal of Obamacare.

Republicans hold 53 seats in the Senate and have only a one-vote advantage on the Banking Committee that will review his nomination. That leaves a narrow path to confirmation for a controversial nominee, who’s drawn criticism from some economists who’ve questioned whether he’s qualified to join the Fed’s seven-seat board of governors.

Moore’s outspoken views on limited government that he’s expressed on television and radio, along with his work for the Trump campaign and as an economist at the conservative Heritage Foundation, seem all but certain to leave him without support from Senate Democrats. Whether he’s confirmed or becomes Trump’s third failed Fed nominee depends on winning support from some of the Republican moderates he’s torched in the past.

GOP Praise

Moore drew some initial praise from some GOP senators Monday, including members of the Banking Committee.

“Moore is an independent thinker, he’s strong-willed, I know him well, I’ve worked with him on a number of issues and I respect him,” said Senator Richard Shelby, an Alabama Republican and a member of the Banking panel. “I think he will be a new voice on the Fed; I believe the Fed could use a voice like that.”

Another GOP committee member, Tim Scott of South Carolina, said he wasn’t bothered by some of Moore’s partisan rhetoric and contrary positions he’s taken as a pundit and political adviser.

“I think separating the rhetoric as a commentator from an actual member of the Federal Reserve you will find him to be very astute, contemplative figure who will add value to the board,” Scott said.

‘Prompt Attention’

Senate Banking Chairman Mike Crapo of Idaho declined to reveal his stance on Moore citing his role as head of the panel, but he said that filling the open position on the Fed board of governors is a high priority. “It will receive prompt attention,” he said.

Two past targets of his barbs, Senators Mitt Romney of Utah and Susan Collins of Maine say they have questions about his credentials and past positions, but didn’t rule out supporting a nomination of Moore.

“It certainly from what I’ve read is an unconventional nomination and I would need to see how he did at the hearings and learn more about him before I could make a judgment,” Collins said.

Among her reservations: Moore urging Trump to fire Fed Chairman Jerome Powell for raising interest rates. “The Federal Reserve is supposed to be independent, so that does concern me,” she said. “And from what I’ve read he also wants to return to a gold standard. I’m not sure what the implications are of that.”

Romney wouldn’t say whether he would support or oppose Moore.

“I will look at all the elements of his background to determine whether he’s qualified to serve on the Fed,” Romney said. “I’ll make that decision after I’ve done that.”

Intraparty Fight

Moore has been in the middle of a decades-long intraparty divide between conservative Republicans and those he’s deemed “RINOs” — Republicans In Name Only.

He once dismissed Collins as part of “the last dying gasp of dinosaur Northeastern Republicans.” And shortly after the 2016 election, Moore criticized the notion that Romney could be the president-elect’s pick for secretary of state, saying it would be a “betrayal” for those who supported Trump since Romney had strongly opposed his candidacy.

Club for Growth

Moore co-founded, in 1999, and for five years led the conservative Club for Growth, which helps fund GOP primary challengers to incumbent moderates in the House and Senate. The group backs limited government, lower income tax rates, less red tape, and also an end to government efforts to address climate change.

When he was head of the group, he took aim at senators in the GOP majority under President George W. Bush. He tried unsuccessfully to replace moderate Republican Senator Arlen Specter of Pennsylvania with Republican primary challenger Pat Toomey, who lost by two percentage points and then went on the replace Moore as president of the Club for Growth. Toomey was elected to the Senate in 2010.

The group also ran ads in the home states of GOP senators George Voinovich of Ohio and Olympia Snowe of Maine, saying they were resisting a portion of Bush’s tax cuts. Both have since left the Senate.

Fed Vacancy

The Fed vacancy doesn’t need to be filled right away and Moore’s nomination could just languish if GOP Senate leaders see that the Trump ally is not getting strong backing, said Sarah Binder, a political science professor at George Washington University.

For much of last year, the seven-seat board had only three members, causing Fed officials to appeal repeatedly to lawmakers to approve new nominees. That pressure has subsided since the confirmations late last year of Vice Chairman Richard Clarida and Governor Michelle Bowman.

“The question is, does” Senator Majority Leader Mitch McConnell “take the time to put the sixth wheel onto the Fed,” Binder said, adding that Trump nominees to other jobs could be a greater priority. “Part of that is whether he gets any negative signals from his colleagues.”

In addition to picking fights with lawmakers, Moore, an economic adviser on Trump’s 2016 campaign has criticized Powell. In a December interview with the Wall Street Journal, he called Powell “totally incompetent’’ after the board raised interest rates. On Monday he dialed that back, telling the Journal that he was harsh in his assessment “and I wish I hadn’t been.’’

Moore is Trump’s sixth nomination to the nation’s monetary authority, a board typically populated with trained economists, bank regulators and financial-industry executives.

Greg Mankiw, a Harvard professor who was chairman of the White House Council of Economic Advisers under George W. Bush, on Friday called on senators to reject him. Writing in a blog post, Mankiw said that Moore “does not have the intellectual gravitas for this important job.”

Two previous Trump nominees, Nellie Liang and Marvin Goodfriend, failed to advance in the Senate in 2018. Unlike Moore, neither faced accusations that they were unqualified.

Moore, who has a master of arts in economics from George Mason University in Virginia, is better known for helping promote a fiscal agenda than he is for monetary-policy expertise. He co-wrote, with economist Arthur Laffer, a 2018 book on Trump’s economic strategy entitled “Trumponomics: Inside the America First Plan to Revive Our Economy.”

After Trump announced Friday that he would be nominating Moore to the Fed, Moore took the unusual step of going on TV. In a Bloomberg Television interview he said the Fed’s unanimously approved December rate increase was “a very substantial mistake.”

He also said he has a “long road ahead” as he turns toward a Senate confirmation process and also said he has lot to learn.

“I’m kind of new to this game, frankly, so I’m going to be on a steep learning curve myself about how the Fed operates, how the Federal Reserve makes its decisions,” Moore said. “It’s hard for me to say even what my role will be there, assuming I get confirmed.”





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