March 14, 2018 / 9:50 PM / 5 days ago

Breakingviews - Trump goes from A-list to CNBC-list with econ pick

WASHINGTON (Reuters Breakingviews) - President Donald Trump is moving from the A-list to the CNBC-list with his new pick for top economic adviser. Larry Kudlow is a seasoned media communicator, and a mostly conventional supply-sider and free trader. But guiding policy for the world’s largest economy requires more than pontificating on television. It’s another sign of this White House’s increasingly shallow talent pool.

Economic analyst Lawrence "Larry" Kudlow appears on CNBC at the New York Stock Exchange, (NYSE) in New York, U.S., March 7, 2018. REUTERS/Brendan McDermid

Kudlow worked as an economist at the Federal Reserve Bank of New York, and did a stint as an official at the Office of Management and Budget under President Ronald Reagan. He became a familiar face to investors during his time as chief economist at Bear Stearns in the late 1980s and early 1990s. For everyone else, Kudlow is best known as a prolific commentator on television and in print media.

Although his commentaries often have a partisan edge, his policy prescriptions are mostly typical center-right stuff, consisting mainly of calls for lower taxes and lighter regulation. He has differed from his soon-to-be boss in one key respect, however. He criticized Trump for his recent decision to levy tariffs on steel and aluminum imports, a move that led to the resignation of the man Kudlow will replace, Gary Cohn. Trump said this week that he welcomes different opinions, but also said that Kudlow has “come around” to see the benefits of the occasional tax on foreign imports.

The disagreement is important because Kudlow’s challenges look very different than Cohn’s. In the wake of the recent tax-cut act, Congress appears to have little appetite for major economic initiatives before the November midterm elections. Instead, the next few months look to be filled with debates over tariffs and trade renegotiations.

Perhaps the most striking part of the selection is not Kudlow himself, but the process that led to his selection. Axios reported that Shahira Knight, the deputy director at the NEC, declined to be considered for the job, and Politico said former Federal Reserve Board governor Kevin Warsh was also not interested.

Recent turnover within the White House and the president’s record of undermining his aides is unlikely to lure in top talent. Trump last week denied reports of chaos and said “everybody” wanted to work in his administration. Cohn resigned that day, and Secretary of State Rex Tillerson was fired the next week. “Everybody” seems to be a shrinking pool.


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