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Trump's Fed picks draw political fire as they angle for the job

(Reuters) - A political feud over President Donald Trump’s picks for the U.S. Federal Reserve Board broke into an open brawl on Tuesday even before the nominations of Herman Cain, a former restaurant chain executive, and Stephen Moore, a conservative economic commentator, have been formally submitted to the Senate.

FILE PHOTO: The Federal Reserve Board building on Constitution Avenue is pictured in Washington, U.S., March 27, 2019. REUTERS/Brendan McDermid/File Photo

Cain and Moore, both overt loyalists to the president, in recent days have waged unprecedented public campaigns for the Fed jobs, with both eagerly endorsing Trump’s economic policies and Moore pledging to “accommodate” those policies once he is at the Fed.

The central bank’s leadership prides itself on its nonpartisan stewardship over the world’s biggest economy, and views political independence as key to its ability to carry out monetary policy effectively.

On Tuesday, Democrats including Senator Chuck Schumer and Joint Economic Committee Vice Chair Carolyn Maloney took public aim at the pair’s qualifications, with Maloney saying that Moore is “superbly underqualified for the role for which he has been nominated.”

And at least four Republican Senators indicated they could break ranks on Cain, enough to sink his chances for the required approval in the Senate.

The Trump administration is “probably going to hear from a number of our members about concerns that they have” about Cain, John Thune, the Republican whip in the Senate, told Politico.

Another Republican senator, John Cornyn, said, “Before the president starts floating names ... we need to have a conversation about who is actually confirmable up here,” according to a Twitter post by New York Times reporter Glenn Thrush.

Cain and Moore are battling hard for the two vacant seats on the Federal Reserve’s Board of Governors, positions that would give them a say for years on interest-rate policy and bank regulation.

In recent days they have taken to social media and the airwaves to promote themselves and lash out at critics and anyone they view as standing in the way of Trump’s agenda or his prospects for reelection.

In an interview with Reuters on Tuesday, Moore trumpeted his agenda for economic growth and again took aim at critics.

“There are a lot of people on the left that are afraid of my ideas. They realize that they couldn’t defeat me based on my ideas, because they’re popular, and they’re right, so that leads to this kind of smear campaign, which is ugly,” Moore said.

“I have a pretty populist agenda that I’m pursuing, which is more growth, higher wages, more transparency and more sunlight on how the Fed operates,” Moore said, calling those priorities “the right things to do” and saying that he wants “to talk directly to the American people.”


Cain and Moore’s open politicking is a departure from past practice, with confirmation of Fed nominees typically a sleepy process of quizzing candidates, mostly economists with doctoral degrees, about their views on monetary policy and banking oversight.

Lewis Alexander, chief U.S. economist at Nomura Securities, said it was positive “for people’s views to be known,” but he added a note of caution. “It is certainly not a part of the Federal Reserve’s mandate to promote the chances of reelection of a particular president.”

Trump has repeatedly criticized the Fed for raising rates, saying that rate hikes are holding back the economy. His pick of Moore and former Republican presidential candidate Cain has been seen by critics as a means to put pressure on the central bank to ease policy and help him politically.

Moore and Cain have kept up unusually public profiles. Cain’s has included digs against Democrats (“lunatic liberals,” he said Monday on Facebook) and gays (a Tuesday tweet linked to a piece on Floyd Brown’s Western Journal that portrays gays as unnatural).

Cain has said he would not be disappointed if he does not get the Fed job, but has repeatedly brought it up on his daily show. In a video posted Tuesday, Cain said “a lot of people ... do not like the fact” that he is under consideration and are trying to discourage the administration from nominating him because of his conservative political leanings. “The decision’s going to be made basically on the facts,” he said.

Cain remains co-chair of the America Fighting Back PAC, which was co-founded by Brown to promote Trump’s reelection. Cain’s photo and name were used as recently as last month in a letter raising funds to oppose a group of 12 senators if they ever “cross” Trump.

Two of those senators are on the Senate Banking Committee, the first stop in a two-step Senate approval process for any Fed nominee. Brown, who was the founding chairman of Citizens United, said in an interview that Cain has stepped back from day-to-day involvement in the PAC. Cain did not respond to requests from Reuters for comment.

Moore in radio and TV interviews has praised Trump’s economic record and embraced easing monetary policy, a stance that Trump himself has vigorously promoted.

People “are not going to vote against someone who has been this successful on the economy,” Moore said on Monday, adding in another interview that day that he is “looking forward to getting over to the Fed.”

Cain’s candidacy appeared by late Tuesday to be drawing the most political fire. Republican Senator Lisa Murkowski told The Hill that she is “not so favorably inclined” on Cain, whose 2012 run for president was derailed by claims of sexual harassment, which he has denied.

Republican Senate leader Mitch McConnell declined to publicly endorse him, the Washington Post reported.

It is not the first time a Fed nominee has faced political opposition. In 2011 Republicans scuttled the nomination by Democratic President Barack Obama of Peter Diamond, a Nobel laureate in economics and MIT professor, for what Republican Senator Richard Shelby then said was a lack of experience and appropriate policy preferences.

Reporting by Ann Saphir and Trevor Hunnicutt; Additional reporting by Howard Schneider; Editing by Leslie Adler