Trump asks senators to choose next Fed chair by show of hands
President Trump on Tuesday asked Republican senators to vote their preference for a new Federal Reserve chairman with a show of hands.
Several GOP senators said Trump asked them to pick between Federal Reserve Governor Jerome Powell and Stanford University economist John Taylor when he attended their closed-door policy lunch on Tuesday.
Sen. Mike Rounds (R-S.D.), a member of the Senate Banking Committee, said Trump brought up the Fed search in a “conversational” way, simply feeling out the GOP conference’s views.
Rounds said Trump only asked about Powell and Taylor, and that most senators simply smiled instead of raise a hand for either candidate.
Sen. Bob Corker (R-Tenn.), amid a bitter feud with Trump, said he declined to participate because “I don’t think that’s a very good way of picking a Fed chair.”
Trump is weighing whether to replace or renominate current Fed Board Chair Janet Yellen, whose term atop the central bank ends in February. Trump has said he’s considering Powell, Taylor, and White House chief economic adviser Gary Cohn for the job.
Trump has been largely complimentary of Yellen since taking office, despite calling her “obviously political” during his White House campaign. He has praised Yellen for maintaining relatively low interest rates, which he says he prefers as a former real estate developer.
While Powell and Taylor are both Republicans, they’d likely lead the Fed through different monetary policy lenses. A Powell Fed would resemble much of Yellen’s current preference for slow rate hikes, while Taylor would likely move to bring rates higher, quicker.
Powell and Taylor would likely get more support from GOP senators than would Yellen, despite a steady stock market and low unemployment under her watch since 2014. Powell and Taylor could also be more willing to peel back Dodd-Frank Act regulations that Yellen has fiercely defended.
Cohn was once seen as the favorite to replace Yellen, but fell out of Trump’s favor after criticizing the president’s response to clashes between protestors and white supremacists in Charlottesville, Va., this summer. His views on monetary policy are less defined, but he has advocated for major rollbacks of Dodd-Frank oversight of banks.
Jordain Carney and Nathaniel Weixel contributed.