President Trump has yet to officially nominate either Herman Cain or Stephen Moore to the Federal Reserve Board of Governors, although he has tweeted his intention for both.
However, Cain’s potential nomination is in trouble before it takes place. With four Republican Senators indicating they would not vote in favor of his confirmation and on the safe assumption that no Democrat would give him a ‘yes’ vote, it would be numerically impossible for Cain to win a seat on the Board.
At this point Mr. Trump can still nominate Cain and hope to change some minds in the Senate. However, Cain’s lack of qualifications combined with prior allegations of sexual misconduct would make it a hard sell. Cain would face a grueling hearing before the Senate Banking Committee that would be unlikely to enhance his standing as a nominee. Trump may simply ask Cain to withdraw without the embarrassment of a failed nomination. If a centrist nominee like Nellie Liang can remove her name from contention due to not wanting to face a drawn out confirmation process, surely Cain can as well to save face.
There has not been a lot said about Moore’s possible nomination in the past week or two. Exposure of his personal financial troubles in conjunction with his close association with discredited economic and fiscal policy make him another problematic nominee. If a well-known economist and former Fed staffer like Marvin Goodfriend had difficulty defending his record, surely Moore would face an even rougher grilling at his nomination hearing.
It could be that Cain is a test case for getting a Trump loyalist at the Board. With the lack of support for Cain, Moore’s name could be allowed to fade from view with minimal comment. If this is the case, it will be back to the drawing board on finding a nominee that would balance the President’s desire for a loyalist on the Board of Governors and finding one that could survive the confirmation process. At this stage, I think it an unsolvable conundrum. However useful it is politically to castigate the Fed for its policies and practices, most Senators recognize the vital importance of an independent central bank, and one staffed by competent and experienced policymakers. It would not be surprising if the two seats on the Board remain vacant for the foreseeable future.
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