Economists and progressive experts responded with exasperation and unease on Friday after President Donald Trump said he will nominate right-wing commentator Stephen Moore to the Federal Reserve, the gatekeeper of the nation's economy.
"The thing that's so unsettling about Moore for the Fed is that—while we all have our gripes—the Fed remains one of the last highly functional institutions left around here."
—Jared Bernstein, CBPP
"I will be nominating Mr. Moore for the Fed. You know who I'm talking about," Trump told reporters while arriving in Florida for the weekend. "He's going to be great on the Fed."
Whispers that Moore, a visiting fellow at the Heritage Foundation who advised Trump's 2016 campaign, might join the central bank had been circulating online since late Thursday. In a tweet on Friday, the president called him "a very respected Economist."
Several critics also pointed out that Moore was among the "principal architects of Kansas Governor Sam Brownback's massive tax cuts, and their predictions that those tax cuts would spur an 'immediate' Kansas economic boom have proved strikingly inaccurate."
As the Center on Budget and Policy Priorities (CBPP), a progressive think tank, explained in a 2016 blog post, "the Kansas tax cut package has had a deleterious impact on the state's financial stability and the provision of critical services." Rather than acknowledging that impact, Moore:
- Substantially backpedaled from the claim that state tax cuts have a "near immediate" positive impact on state economic growth;
- Doubled-down on his tax policy recommendations;
- Used inaccurate data to justify the tax cut; and
- Continued to selectively and misleadingly cite data to support his claim that the tax cut is leading to improved economic performance in Kansas.
Chye-Ching Huang, CBPP's director of federal fiscal policy, shared the post on Twitter:
The White House is reportedly considering Stephen Moore for a Federal Reserve Board seat. https://t.co/ZpTHFQq5QA
Moore has proved deeply impervious to facts.
Faced w/ the spectacular failure of the KS tax cuts he championed, reflection & growth?
— Chye-Ching Huang (@dashching) March 22, 2019
As New York Times economic columnist Paul Krugman put it on Friday, linking to the CBPP post, "He made a bad prediction, which happens—but refused to learn from the error, falsified facts, and doubled down on his doctrine."
Others noted Moore's support for the tax overhaul Republicans pushed through Congress at the end of 2017, which critics often call the Trump or GOP "tax scam."
Trump just nominated Stephen Moore to the Federal Reserve: a staunch advocate for lower taxes on the rich and higher taxes on workers
Normal for the #GOPTaxScam team that perpetrated the largest transfer of wealth to the rich in modern history.
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The watchdog group Common Cause, in a series of tweets, detailed Moore's ties to the Koch Brothers, fossil fuel billionaires infamous for funding right-wing politicians and organizations:
Stephen Moore has A LOT of connections to the Koch brothers and the groups they fund.
Here is a short thread on some of those connections...
— Common Cause (@CommonCause) March 22, 2019
If Moore is confirmed by the GOP-controlled Senate, he will fill one of two current vacancies on the Board of Governors of the Federal Reserve System.
"The thing that's so unsettling about Moore for the Fed is that—while we all have our gripes—the Fed remains one of the last highly functional institutions left around here," tweeted CBPP senior fellow Jared Bernstein. "One misguided pick won't change that, but it will chip away at it."
Washington Post economics correspondent Heather Long highlighted that if Moore is approved by lawmakers, he could serve up to 14 years on the board. Long called Moore "Trump's most political appointment to the Fed yet."
While it was a bold and blatantly political move, Trump's nomination of Moore didn't seem to shock some who have observed the president's tendency to surround himself with sycophants.
As the Los Angeles Times reported Friday:
Moore co-wrote an opinion article in the Wall Street Journal last week titled, "The Fed is a Threat to Growth," which blamed recent interest rate hikes by the central bank for slowing U.S. economic growth and causing "wild swings in the stock market."
The criticism echoed Trump's unprecedented public pressure campaign on Fed Chairman Jerome H. Powell to stop slowly increasing a key interest rate.
"Moore's direct criticism of Powell surely scored points with Trump," said Capital Alpha Partners, a Washington strategic research firm, in a report Friday.
Noting that Moore has echoed Trump's attacks on Powell, Kevin Drum wrote for Mother Jones, "It's impossible to flatter Donald Trump so much that he figures out what you're doing, and sure enough, Moore's willingness to abase himself to Trump's beliefs has earned him a big promotion."
Denouncing Moore as a "hack," Drum said, "This is about like nominating Dr. Phil to run the CDC."