President Trump announced this morning that he is nominating Kevin Warsh as the next Chairman of the Board of Governors of the Federal Reserve:
Stephen Moore and his colleagues at the Committee to Unleash Prosperity greeted Warsh’s appointment enthusiastically:
He’s a superb choice and one we’ve been pushing for more than a year. Congrats, Mr. President. You hit the bullseye.
Unlike the failed tenure of Jerome Powell, Warsh is not political; he is not an inflationist, and he rejects the economic mysticism that printing money causes growth.
Just as importantly, Warsh has told us many times that he also rejects the moronic Phillips Curve notion that growth causes inflation. Powell believed it and that led to the four years of Biden stagflation with stagnant real wages and high prices.
As Warsh wrote in the WSJ:
The Fed should re-examine its great mistakes that led to the great inflation. It should abandon the dogma that inflation is caused when the economy grows too much and workers get paid too much. Inflation is caused when government spends too much and prints too much.
Exactly.
We agree with our economic advisory board member, David Malpass, that the overriding goal of the Warsh Fed should be to keep the dollar strong and prices stable. Defend the dollar.
Democrats love to talk about “affordability,” but they are the ones who have driven up prices through policies that have expanded the money supply while restricting production of goods–a lethal combination. Once again, President Trump is on the right track.
