This week, President Trump’s Fed nominee Stephen Moore fought back against the left-wing smear campaign targeting him, and received support when National Economic Council Director Larry Kudlow reaffirmed the Trump administration’s commitment stating “We continue to back Stephen Moore.” While liberals and their media allies continue to re-litigate his divorce filings and comb through his (very) old columns, for those interested in what Stephen Moore actually thinks about economics, here are three reasons why Americans should want him on the Federal Reserve’s Board of Governors:
1.) Stephen Moore understands that economic growth does not cause inflation.
As a recent Fox Business article noted:
The Federal Reserve currently has a groupthink problem, and Moore is the solution. Unlike the current Fed board, Moore doesn’t believe economic growth causes inflation. He believes in promoting private sector growth, rising wages, job creation and a strong dollar.
Stephen Moore’s views on inflation echo those of Director Kudlow, who recently had this exchange at the National Press Club (video at 34:30):
Reporter: “What do you think does trigger inflation?”
Director Kudlow: “Bad money and a collapsing dollar….Too much money chasing too few goods. Policies that destroy the value of a currency and the demand for it. We watched this in the 70s…inflation went to double digits….we came close to destroying the dollar in the 2000s under a Republican President I regret to report… that’s what causes inflation, not too many people working.”
2.) Stephen Moore was correct about the impact of Trump’s economic policies.
As evidenced by the Q1 GDP report released today, the U.S. economy continues to reap the benefits of President Trump’s tax cuts. While Stephen Moore predicted that Trump’s economic agenda would grow our economy, many of the economists now attacking Moore’s nomination had the whole story wrong.
A report in CNSNews noted:
Moore has also been broadly right about the Trump economic agenda, while many economists have been epically, comically wrong.
On election night 2016 Moore-antagonist Paul Krugman of The New York Times famously wrote: “markets are plunging. When might we expect them to recover? A first-pass answer is never … So, we are very probably looking at a global recession, with no end in sight.”
As Moore noted in an IBD op-ed that served as a well-deserved victory lap, Krugman was far from alone, with similar doom-and-gloom predictions of financial and economic collapse coming from chief economist at the IMF Eric Zitzewitz, Obama chief economist Larry Summers, MIT economist Simon Johnson, and MSNBC economics guru Steve Rattner. A pre-election Washington Post headline blared: “A President Trump Could Destroy the World Economy.”
3.) Stephen Moore supports a rules-based monetary policy.
Stephen Moore believes that U.S. monetary policy should be directed by a clear, transparent rule rather than subject to the Fed’s arbitrary discretion.
As Ralph Benko wrote for the American Spectator:
No less than Hayek, in his Nobel Prize acceptance speech titled The Pretence of Knowledge, acidly criticized the economics profession for something he called “scientism,” meaning emulating the style but not the substance of the natural sciences. The Fed, with its many hundreds of PhD economists on staff is operating a pseudoscientific model.
Whether or not one accepts Moore’s commodities-index target (I do not) or Cain’s belief in the gold standard (I do), their appointment and confirmation would be consistent with President Trump’s reported desire for better equitable prosperity….to challenge the Fed to up its game by adopting a monetary rule better calculated to restore equitable prosperity…
Once confirmed, Stephen Moore will bring an independent, outside voice to the Fed that will challenge its economic dogma. Moore’s belief that a stable dollar produces the best climate for economic growth is an argument that the Fed needs to hear. That’s why his nomination represents the best opportunity in decades to bring a true reformer to the Fed.
Photo credit: Gage Skidmore