Multiple Senate Republicans have expressed doubts about the prospects for confirming conservative commentator Stephen Moore if President Trump nominates him to the Federal Reserve Board of Governors. They cited among other issues his comments about women. Here is a sample.
Aug. 1, 1994 column for The Washington Times
“Probably the most objectionable pork in the entire legislation is the $1.8 billion earmarked for Sen. Joe Biden’s ‘Violence Against Women Act.’ That act sets up gender sensitivity programs for judges and police; classifies assaults against women as ‘hate crimes’ or civil rights offenses, and passes out millions of dollars to women’s groups for ‘rape education’ and a smorgasbord of other programs. The act would be more efficient if Congress cut out the federal middleman and simply required every American household to write a $20 check to the radical feminist group of its choice.”
Nov. 7, 2000 column in National Review
Explaining that his wife voted for a Democrat: “Women are sooo malleable! No wonder there’s a gender gap.”
March 19, 2002 column in National Review
Writing about the “March Madness” NCAA college basketball tournament: “Here’s the rule change I propose: No more women refs, no women announcers, no women beer vendors, no women anything. There is, of course, an exception to this rule. Women are permitted to participate, if and only if, they look like Bonnie Bernstein. The fact that Bonnie knows nothing about basketball is entirely irrelevant.”
Nov. 21, 2013 speech at Brown University
“You all know the motto for Fox News, right, John? It’s, uh, ‘Fox News: Fair Balanced and Blonde.’ Haha! I’ve met a lot of beautiful women at Fox News and it’s one of the fringe benefits of working there.”
April 10, 2014 column for National Review
“What are the implications of a society in which women earn more than men? We don’t really know, but it could be disruptive to family stability. If men aren’t the breadwinners, will women regard them as economically expendable? We saw what happened to family structure in low-income and black households when a welfare check took the place of a father’s paycheck. Divorce rates go up when men lose their jobs.”
July 19, 2016 debate at Republican National Convention
“I’d get rid of a lot of these child labor laws. I want people starting to work at 11, 12. It’s amazing how many people I meet who are successful…who grew up on a farm and started working on a farm at age 10, 11, 12 years old where you learn a work ethic.”
“If we do have a higher minimum wage, nationally…we must, must, must must have a policy that has a $6- or $7-an-hour teenage minimum wage because we’re going to price a lot of those young people out of the workforce, and they’re not going to get the training we need.”
“And by the way did you see that there’s that great, um, cartoon going along that the New York Times headline: ‘First thing that Donald Trump Does as President is Kick a Black Family Out of Public Housing?’ And it has Obama leaving the White House? I mean, I just love that one. But uh — It’s just a great one.”
Shown a video clip of that speech on an episode of PBS’s Firing Line with Margaret Hoover that aired April 30, 2019, Mr. Moore sought to defend himself, saying, “You know, that is a joke I always made about, you know, Obama lives in, you know, the president lives in public housing, but I didn’t mean it like a black person did.”
Aug. 17, 2017 appearance on CNN after Charlottesville riots
“I mean, Robert E. Lee hated slavery. He abhorred slavery, but he fought for his section of the country…The civil war was about the South having its own rights.”
“Can I say something politically incorrect? Republican women are so much more beautiful than Democratic women.”
It starts, but doesn’t end, with ditching Stephen Moore.
First, the policy. Our president’s past views on monetary policy range all over the map; he has been both an inflation hawk and an inflation dove, and he obviously has no definite and deeply held views on monetary issues, as he has no definite and deeply held views on many other topics.
But as on other issues, that lack of ideological mooring has enabled him to break loose from the stale formulas, the always-1979 assumptions, that defined a lot of conservative thinking in the last 10 years.
Shaped by the battles of the inflationary 1970s, much of the right reacted to the financial crisis and its aftermath by critiquing Ben Bernanke’s Fed for its interventionism and warning about imminent inflation. A few conservative journalists and economists dissented, arguing that the situation was very different, the ’70s weren’t returning, and if anything the Fed’s policy had been too hawkish. But you had to listen hard to hear them; for the most part institutional conservatism and Republican politicians kept up a steady “inflation is coming” beat.
Actual economic trends, however, vindicated the dissidents. And now Trump himself, for instinctive and opportunistic reasons, has taken up a crude version of their argument, jawboning Jerome Powell to discourage rate increases (a self-interested position, but also the correct one) and trying to elevate Moore in part because he currently shares the White House’s dovish line.
But a lot hangs on that “currently.” Historically Moore has not been an inflation dove; indeed when it counted he was a predictable inflation hawk, calling for monetary tightening in the teeth of the Great Recession. So it’s hard to escape the impression that his newfound dovishness is simply a hack’s adaptation to whatever Trump demands. Especially because — let’s be completely blunt here — Moore’s entire record of writings and arguments are hackish, his prominence a testament to cable-television’s appetite for partisans with think-tank titles, and those titles a testament to conservatism’s decadence.
So while Trump’s embrace of dovishness is moving the Republican Party in a sensible direction on the issue, his personnel moves aren’t rewarding the dissidents who were correct ahead of time. Instead, after making some respectable but uncreative picks, he’s trying to bring in yes-men and conservative-entertainment personalities (like his other, since-withdrawn choice for the Fed, Herman Cain) and relying on their loyalty rather than their ideas to make the policy he favors.
The desire to reward loyalists rather than intellectuals is common to politicians, and many dissident-conservative intellectuals were cool to Trump during the 2016 campaign. But most presidents make some effort to instantiate their governing ideology by elevating figures who actually believe it, rather than relying exclusively on toadies and ring-kissers and guys who look the part when you turn on Fox or CNN.
Not so Trump: All instinct and solipsism, he simply doesn’t care enough about Trumpism to find people who might carry his impulses forward once he’s gone. And so he’s bidding to do for monetary policy what he’s done in domestic policy and foreign policy already: Pursue a somewhat heterodox and populist agenda, but leave its implementation — and therefore to some extent its future — in the hands of men like Moore or John Bolton or Mick Mulvaney who represent the consensus that he once campaigned against.
That desire suggests a very plausible post-Trump scenario — especially if a liberal Democrat occupies the White House next — in which the Republican Party simply abandons his heterodoxies and returns to all its Obama-era positioning, all its reflexive policy clichés. Which in turn would set the stage for yet another Trump-like populist rebellion against this orthodoxy five or 10 years down the line.
In fairness, some Republican lawmakers appear to want to avoid this kind of pointless cycle. A younger cohort in the Senate, including Marco Rubio and Tom Cotton and Mike Lee and lately Josh Hawley of Missouri, appears interested in sustaining a conservative populism after Trump has exited the stage. And as Ramesh Ponnuru noted in a recent Bloomberg column, judging by how they questioned Powell in February, some Republican lawmakers seem to be “shopping” for a different monetary policy, one that actually learns something coherent from the last 10 years.
If those shoppers are serious, they should reject Moore on the basis of his empty intellectual portfolio, not just his dumber experiments in punditry, and they should encourage Trump to make a different kind of outside-the-box pick. I have suggested Ponnuru as a possibility before; as a journalist he has a long paper trail of rigorous, mostly vindicated takes on monetary policy, and as a representative of the right’s intelligentsia he’s everything that Moore is not.
Another clever choice would be Karl Smith, another Bloomberg columnist, a former economics professor and a prolific economics blogger, who has also defended Trump’s much-criticized tax reform (in case that matters to anyone in the White House!). Alternatively, if Trump prefers someone with a current academic title, then he should tap Scott Sumner or David Beckworth from George Mason University, both of whom were elaborating the more dovish case back when Moore was still pitching the gold standard.
Of course because they’re serious people, that “dovish” case is far more sophisticated than the White House’s palpable desire for rate cuts as re-election stimulus. Also, Sumner recently called for Trump’s impeachment … so, yeah, he’s probably off the table.
But so long as Moore’s nomination is in trouble, there is an opportunity here for some entrepreneurial senator to push the White House in a new direction — toward the actual institutionalization of the president’s better instincts, rather than just the appointment of hacks who flatter him. For it will have profited conservatism nothing to have surrendered to Trump’s rebellion, if all it gains in the end is another decade submitting to the imaginary “expertise” of hacks like Stephen Moore.
Those decades of free-market machinations are now paying off, as a quintet of Ronald Reagan administration alumni — Kudlow, Laffer, Forbes, Moore and David Malpass—united by undying affection for each other and for laissez-faire economics, have the run of Washington once more. Members of the tight-knit group have shaped Trump’s signature tax cut, helped install each other in posts with vast influence over the global economy, and are working to channel Trump’s mercantilist instincts into pro-trade policies. Blasted by their critics as charlatans and lauded by their acolytes as tireless champions of prosperity, there’s no denying that the quintet has had an enduring impact on decades of economic policy.
Most recently, in late March, and partly at Kudlow’s urging, Trump announced his intention to nominate Moore to one of two open seats on the Federal Reserve Board of Governors, the body that sets the tempo of the global financial system.
The announcement prompted protests from economists across the ideological spectrum—George W. Bush’s top economist, Harvard’s Gregory Mankiw, said Moore lacked the “intellectual gravitas” for the job—who warned that appointing Moore, a think-tanker with no Ph.D., would politicize the Fed. Soon, it emerged that Moore had made a mistake on a 2014 tax return that led the IRS to place a disputed $75,000 lien against him, and CNN dug up scathing comments Moore had made about Trump during the presidential primary.
Whether Moore can survive the scrutiny and pass muster with the Senate will be a test of the supply-siders’ renewed cachet. They believe they can pull it off.
“I understand there are imperfections,” Kudlow told POLITICO. “I think it can be worked out.”
Moore described some of his recent conversations with Trump, which often turn to Fed Chairman Jerome Powell.
“I think his criticism of Powell is excessive and could be counterproductive,” Moore said, because it could actually provoke Powell to prove his independence by defying Trump’s wishes. Generally speaking, Trump wants Powell to keep interest rates low to decrease the chances of any economic slump before the president faces voters again next November.
Moore also recounted how he and Laffer, who began advising Trump in 2016, helped place Kudlow in his current posting.
Roughly a year into Trump’s term, as Trump’s first NEC director, Gary Cohn, prepared to depart the post, the duo sprang into action. Moore said that during this period, whenever he and Laffer engaged in their semiregular consultations with Trump, they would have some version of the following exchange:
“You know, Mr. President, you’re missing one thing,” Laffer or Moore would say.
“What is that?” Trump would ask.
“Larry Kudlow,” Laffer or Moore would tell him.
“We just drilled the message over and over,” Moore recalled. “‘Larry, Larry, Larry, Larry.’”
During that same period, following the 1974 midterms, Laffer first drewhis famous Laffer Curve — a representation of the idea that at a certain level of taxation, lowering taxes would theoretically spur enough growth that government revenue would actually rise—at a meeting near the White House with Wanniski, Dick Cheney, then an aide to President Gerald Ford, and Grace-Marie Arnett, another free marketeer active in Republican politics.
Reagan would go on to fully embrace supply-side theory, a shift from the party’s traditional emphasis on fiscal discipline, appointing Laffer to his Economic Policy Advisory Board.
Then as now, supply-side economics was criticized for favoring the rich and derided by critics as unrealistic “Voodoo Economics.” The critics got an early boost from a 1981 Atlantic cover story in which Reagan’s budget director, David Stockman, aired his doubts that this novel theory was working in practice.
The piece ruined Stockman’s standing with Reagan—Laffer calls him “the traitor of all traitors”—but Stockman’s young aide, Kudlow, now 71, remained a loyal supply-sider and struck up a relationship with Laffer.
Reagan would go on to appoint Forbes as the head of the Board of International Broadcasting, which oversaw Radio Liberty and Radio Free Europe, and Moore worked as the research director for Reagan’s privatization commission. Malpass, meanwhile, worked in Reagan’s Treasury department. Representatives for Forbes and Malpass said they were not available for interviews.
In the 1988 presidential primary, another supply-sider, the late New York congressman Jack Kemp, lost out to George H.W. Bush, curtailing the crew’s influence within the party.
But they stuck together. Moore, now 59, first became close with Laffer and Kudlow in 1991, after he recruited them to participate in an event celebrating the 10-year anniversary of Reagan’s first tax cuts for the libertarian Cato Institute.
In 1993, Kudlow and Forbes teamed up to craft a tax cut plan for New Jersey gubernatorial candidate Christine Todd Whitman, who went on to unseat incumbent Democrat James Florio.
Meanwhile, Kudlow hired Malpass to work for him at Bear Stearns, where he had been flying high as the investment bank’s chief economist.
The next year, Kudlow crashed to earth—he left the bank and entered rehab for alcohol and cocaine addiction. Laffer stuck by Kudlow, hiring the investment banker to work for his consulting firm in California when he emerged.
In 1996, Forbes, backed by Moore, entered the Republican primary and lost out to Bob Dole, but the group takes credit for getting Kemp picked for the bottom half of that year’s ticket, which lost to incumbent Bill Clinton.
And they have not stopped partying since. Members of the group have continued to actively socialize with each other over the decades, with some spending New Year’s eves together. At one birthday party for Laffer in New York, they presented the aging economist with a signed poster of the Jedi master Yoda. “I’m short, a little bit fat. I’ve got big, green ears,” Laffer explained. “I look sort of like Yoda.”
In 2015, Forbes, Laffer, Kudlow and Moore created the Committee to Unleash Prosperity, a group intended in part to counter the emergence of the “Reformicons,” a rival gang of Republican eggheads who felt the party had gone too far in the direction of laissez-faire policies favoring the rich.
Among the other 29 committee members listed in a press release were both Malpasses, Kevin Hassett, now chairman of Trump’s Council of Economic Advisers, and Andy Puzder, who was Trump’s initial pick for labor secretary until allegations of domestic abuse unearthed by POLITICO derailed his nomination.
The group sought, with considerable success, to vet Republican presidential candidates for their supply-side credentials and to influence their platforms, holding large private dinners at Manhattan venues such as the Four Seasons and the 21 Club, so that committee members and other notable invitees—like Rudy Giuliani and Roger Ailes—could feel out the candidates.
Before meeting with the larger group, candidates would huddle with the committee’s founders to receive economic tutorials. Or in the case of Ohio Governor John Kasich, to give one. “We were all sitting there, and he would talk for an hour,” Moore recalled. “We’re like, ‘No, we’re supposed to be talking to you,’ and he’s talking to us.” Moore called the episode “Classic John Kasich.”
Though the events were supposed to be off the record, journalists often attended, and an otherwise lackluster February 2015 dinner for Wisconsin Governor Scott Walker made headlines when Giuliani barged in, proclaimed he did not believe that President Barack Obama “loves America,” and insisted a POLITICO reporter could print the quote.
President Donald Trump’s Fed appointments so far have represented a modest shift away from rule-by-economists. Chairman Jerome Powell and Vice Chairman for Supervision Randal Quarles are both lawyers with a mix of government and private-sector experience. Trump also nominated two economics Ph.D.s with Fed backgrounds, but the Republican Senate never got around to confirming either. Now, of course, he has made known that he wants to nominate Stephen Moore, who has a master’s degree in economics but is known mainly for his political activism — he co-founded and was first president of the Club for Growth, which pushes, often successfully, to elect anti-tax candidates, and was a Trump adviser in the 2016 campaign — and his punditry.
Moore’s punditry, it must be said, gets some pretty dire reviews, even from people who share many of his political views. He “does not have the intellectual gravitas for this important job,” prominent Republican economist N. Gregory Mankiw opined. “The consensus in conservative academic think tank land is that Moore is an enormous hack,” conservative New York Times columnist Ross Douthat wrote on Twitter.
I have followed Moore’s opinion journalism on taxes for many years and have been similarly unimpressed. His less voluminous output on monetary policy seems, if anything, even worse. On taxes, Moore has espoused the consistent and often correct view that cutting them can bring higher economic growth; the problem is that the arguments and data he marshals to support this view are often dodgy. On monetary policy, Moore’s factual claims have been at least as unreliable — the Cato Institute’s George Selgin and the Washington Post’s Catherine Rampell both have detailed accounts of his bizarre (and false) claim that former Federal Reserve chairman Paul Volcker swore by a “Volcker rule” of targeting commodity prices at the Fed — and he also has no coherent ideology, seeming instead to favor tight money when a Democrat is in the White House and easy money when a Republican is. Not just an enormous hack, then, but a transparently partisan hack.
For more than a generation, the Federal Reserve has floated above politics, even as partisan conflict has consumed other public institutions. Republican chairmen, including incumbent Jerome Powell, have run the Fed for 28 of the last 32 years, yet you’d struggle to find a trace of monetary favoritism when Republicans occupied the White House.
That political appointees have behaved so apolitically is not a law but a norm taken for granted by both parties—until now. At first, President Trump observed that norm: His Fed appointments were praised as qualified, competent and apolitical, including Mr. Powell, at the time a sitting governor. But he is now breaking from that norm. He has publicly attacked Mr. Powell for raising interest rates and has proposed naming to the Fed two loyalists who share his views.
It takes more than just a president to politicize the Fed: Its chairman and Congress must also acquiesce. For now, Mr. Powell and his current colleagues seem unlikely to be swayed. The real test is whether Congress is prepared to let Fed appointments become, as they are with the Supreme Court, a tool of partisan advantage... Mr. Trump’s two proposed nominees have drawn criticism over their qualifications. Stephen Moore has a degree in economics, and Herman Cain was a successful businessman, but neither has worked in finance, or has a deep grasp of monetary policy. (While Mr. Cain chaired the board of one of the Fed’s 12 reserve banks, that position carries no monetary responsibility.) Their main qualification is that they are vocal advocates for Mr. Trump. Mr. Moore this week said the Fed may be endangering Mr. Trump’s re-election prospects with tight monetary policy... If they don’t agree, they’ll be just two votes on the seven-member board of governors that, along with five of the 12 reserve bank presidents, decides monetary policy, usually by consensus. Two dissidents can make life hard for the chairman, with critical speeches and media appearances. But if their arguments aren’t credible, they won’t sway any other members. Indeed, other officials may draw closer to Mr. Powell out of solidarity… Historically, only the Fed chairman can bend policy to a president’s wishes. Arthur Burns did so for Richard Nixon in the early 1970s because he saw himself as part of Mr. Nixon’s team. Ronald Reagan appointed four governors who in 1986 briefly approved a rate cut over the opposition of then-chairman Paul Volcker. When Mr. Volcker stepped down the next year, Mr. Reagan named Alan Greenspan, a longtime Republican insider, to succeed him. But Mr. Greenspan proved as independent as Mr. Volcker, repeatedly defying White House pressure to keep rates down. From 1993 until last year, presidents stopped trying.
The tax cut fizzled; send in the clowns!
As far as I know, the Federal Reserve — the world’s most important economic policy institution — doesn’t have an anthem. But if it were to adopt one now, the choice would be obvious: “Send In the Clowns.”
You see, the Fed’s governing board currently has two vacancies, and Donald Trump has proposed filling those vacancies with ludicrous hacks. If he succeeds, one of our few remaining havens of serious, nonpartisan policymaking will be on its way toward becoming as corrupt and dysfunctional as the rest of the Trump administration.
Stephen Moore and Herman Cain are, of course, completely unqualified — I say “of course” because their lack of qualifications is, paradoxically, a key qualification not just for Trump but for the G.O.P. in general.
There are plenty of genuine monetary experts with conservative political leanings, some of them quite partisan. But modern Republicans have shown consistent disdain for such experts, perhaps because of a sense that anyone with real expertise or an independent reputation might occasionally be tempted to take a stand on principle.
There’s no risk that either Moore or Cain will ever take such a stand. In fact, what seems to have recommended both men to Trump was their evident willingness to completely reverse their policy views when politically expedient.
Both were hard-money men during the Obama years, demanding higher interest rates despite very high unemployment. Both have now taken to berating the Fed for failing to print more money in the face of low unemployment — because that’s what Trump wants.
That said, there’s a difference between the two men.
I wrote about Moore a couple of weeks ago, noting that he has long been a prominent fixture in the conservative movement; he is, basically, a classic right-wing hack who tries (incompetently) to impersonate an economic expert. Cain, on the other hand, is a spam king whose business model involves making his email list available to direct marketers.
Put it this way: In recent years Moore has been out there predicting magical results from tax cuts, putting out fake economic numbers, and giving speeches to FreedomFest. At the same time, Cain has been offering a platform for peddlers of get-rich schemes and cures for erectile dysfunction. So it says something about what Trump wants that he apparently sees the two men as equally valuable allies.
What does Trump want? His attempted beclowning of the Fed follows, I’d argue, from the fact that his one major legislative success, the 2017 tax cut — which he predicted would be “rocket fuel” for the economy — has turned out to be a big fizzle, economically and, especially, politically.
It’s true that U.S. economic growth got a bump for two quarters last year, and Trumpists are still pretending to believe that we’ll have great growth for a decade. But at this point last year’s growth is looking like a brief and rapidly fading sugar high.
Meanwhile, the tax cut remains unpopular, partly because few people perceived personal benefits, partly because voters appear to be less concerned about paying too much than with the sense that the rich — the prime beneficiaries of the Trump cut — are paying too little.
Some leaders might see such disappointments as reasons to make a course correction. But this is Trump: When the going gets tough, he blames someone else. Everything would have been great, he insists, if the Fed hadn’t thwarted his plans.
There’s a good argument to be made that the Fed misjudged the economy’s strength, that it raised interest rates too fast and that the economy would be doing somewhat better if it hadn’t. In fact, it’s an argument I agree with.
But that’s not what Trump is saying. He wants the Fed to act as if we were still in a deep depression; he wants it both to cut rates and to resume the emergency policies it pursued — and he denounced — when we had more than twice as much unemployment as we do today. This would, he insists, turn the economy into the “rocket ship” he originally promised.
You don’t have to be a gold bug or even an inflation hawk to see these demands as deeply irresponsible. Indeed, they sound a lot like the “macroeconomic populism” that has repeatedly led to economic disaster in Latin America, with Venezuela the latest example.
Running the printing presses to fight a depression, as the Fed did after the financial crisis, is prudent and sensible; running them because you refuse to accept the reality that your policies aren’t delivering an economic miracle is different, and always ends badly.
Now, even putting both Moore and Cain on the Fed board probably wouldn’t be enough to push America over the monetary edge. And so far, markets don’t seem worried about the potential for runaway inflation.
But maybe investors should be worried, at least a bit, by the spectacle of a president who would rather appoint hacks and debase the Fed’s integrity than admit that his policies aren’t working as promised. U.S. policymaking is looking ever more like that of a corrupt third-world regime. And that is bound, sooner or later, to have consequences.
Andrew Yang, entrepreneur, founder of the non-profit Venture for America, 2020 presidential hopeful, and the author of The War on Normal People: The Truth About America’s Disappearing Jobs and Why Universal Basic Income Is Our Future (Hachette Books, 2018), talks about his presidential bid and his proposal to provide a universal basic income to all.