Moore Bails as Trump’s Fed Pick Hours After ‘I’m All In’ Pledge
(Bloomberg) -- President Donald Trump’s selection for the Federal Reserve Board of Governors, Stephen Moore, pulled out of consideration for the job hours after he said he was “all in” for the central bank.
Trump said on Twitter on Thursday that Moore had decided to withdraw. There were growing objections to his potential nomination among Senate Republicans, but only hours earlier Moore said in an interview with Bloomberg News that the White House had indicated he would still be nominated, and that he would withdraw only if Trump asked him to.
“My biggest ally is the president,” Moore said in the interview. “He’s full speed ahead.”
“I’m all in,” Moore added.
Moore was described by some critics as a threat to the Fed. In addition to being an unpredictable commentator and unorthodox economic thinker, Moore struck some economists as a partisan pick who might inject a short-term political agenda into monetary policy deliberations, which central bank independence is designed to guard against.
Moore’s exit comes less than two weeks after Trump’s pick for another Fed seat -- former Godfather’s Pizza Inc. Chief Executive Officer Herman Cain -- withdrew from consideration as criticism related to sexual harassment allegations eroded support for him.
The White House has yet to announce new candidates. Possibilities include Judy Shelton, a conservative economist, and Craig Phillips, a counselor at the Treasury Department. Both of them are interested in the Fed posts, according to people familiar with the matter.
Shelton was endorsed last month for the Fed by the Wall Street Journal editorial board. Moore said on Fox Business Network after his withdrawal that Shelton would be a good candidate.
In a statement after Trump’s tweet, Moore said he was withdrawing because “unrelenting attacks on my character have become untenable for me and my family and 3 more months of this would be too hard on us. ” He said he’d continue to be a “loud economic voice” advocating Trump’s policies.
Criticism of Moore’s candidacy had increasingly worn on his wife, Anne, according to two people familiar with the matter.
Before Trump named him for the Fed board, the White House was considering Moore to be Vice President Mike Pence’s chief economist, according to two people familiar with the matter. That post opened when Mark Calabria was appointed to lead the Federal Housing Finance Agency.
The people asked not to be identified because of the sensitivity of the matter.
Phillips, the Treasury counselor, is a former BlackRock Inc. executive who, under Mnuchin, has led Treasury’s review of financial regulations with an eye toward rolling some of them back -- a policy opposed by Democrats. He’s also working on an overhaul of housing finance.
But his employment in the Trump administration has been controversial. He was a member of former Secretary of State Hillary Clinton’s national finance committee for her 2016 presidential campaign, earning him the title “Hillblazer” for his fundraising efforts. Some officials at Trump’s White House and Treasury opposed his hiring, but Treasury Secretary Steven Mnuchin, who has known Phillips for more than 25 years, overruled them. Phillips’s position doesn’t require Senate confirmation.
Moore said in the Bloomberg News interview, before his withdrawal, that he believed he’d win votes from some Senate Democrats if he could advance to a confirmation hearing before the chamber’s Banking Committee. Moore said he expected Trump to formally nominate him for the Fed within about three weeks.
But he said that he’d withdraw if Trump decided that’s best.
“I’m going to do what the president wants me to do,” he said. “If he wants me to keep fighting, I’m going to keep fighting. If he thinks it’s time to throw in the towel, I’ll do that.”
Surprised by Opposition
Moore expressed surprise at push-back to his candidacy from Senate Republicans, including Iowa’s Joni Ernst and South Dakota’s John Thune, the second-ranking GOP leader. They have raised concerns about Moore’s past writings in which he disparaged women, and some senators have questioned whether he’s sufficiently independent from the White House.
“Some of the stuff about women that’s come out, this was all humorous, meant to be humorous pieces,” Moore said. “Certainly that’s caused some problems with a number of the senators. So my strategy is I want to sit down with them in the weeks ahead.”
The 59-year-old fellow at the conservative Heritage Foundation served as an adviser to Trump’s 2016 campaign and penned a book titled “Trumponomics: Inside the America First Plan to Get Our Economy Back on Track.” He holds a master’s degree in economics from George Mason University in Virginia.
Moore was once an advocate for higher interest rates who worried about runaway inflation and the growing national debt. But since Trump’s election, he has advocated for lower rates and has been mostly silent about the debt. Moore said Thursday that it was acceptable to grow the national debt in exchange for higher employment.
Given his recent history of anti-Fed rhetoric and his ties to the White House, news of Moore’s nomination had stoked concerns about central bank independence. By design, monetary policy makers do not answer to the president, leaving them free to make decisions that will cause near-term economic pain but will encourage longer-term economic sustainability.
CNN reported in April that Moore had written columns for the National Review more than a decade ago that derided women. His arguments included that women should not be allowed to referee men’s college basketball games, and that woman athletes advocating for pay equality wanted the same money “for inferior work.”
Financial issues loomed over his candidacy as well. A federal tax lien filed in the circuit court for Montgomery County, Maryland, where Moore owns a house, says that the government won a judgment against Moore for $75,328.80. The January 2018 filing said it was for unpaid taxes from the 2014 tax year. Moore has said that he took a “mistaken deduction” and that he’s subsequently overpaid his taxes.
Moore was also found in contempt of court after he failed to pay his ex-wife some $300,000 in alimony after their 2010 divorce, the Guardian reported, citing court records. Moore said in a radio interview on April 1 that he and his ex-wife are on good terms now.
As a Fed Governor, he would’ve had a constant vote on monetary policy, and would’ve been one of 18 voices on the policy-setting Federal Open Market Committee.
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