President Donald Trump said Thursday he is recommending Herman Cain, a political ally and former presidential candidate, for a seat on the Federal Reserve board.
“I’ve told my folks that’s the man,” Trump told reporters in the Oval Office, saying that Cain is currently going through background checks prior to a formal nomination.
“He’s a very terrific man, a terrific person. He’s a friend of mine,” Trump said. “I have recommended him highly for the Fed.”
The choice of Cain would mark the second Trump nomination that would elevate a conservative Trump ally to the Fed’s main policy-making body, a panel that the president has been highly critical of in recent months.
The president last week said he plans to nominate Stephen Moore for a separate vacancy on the board. Moore’s nomination has encountered criticism that he is unqualified and too politically focused for a Fed board seat.
Cain, a former CEO of Godfather’s Pizza, ran for the 2012 Republican presidential nomination but dropped out after allegations of sexual harassment and infidelity.
The nominations of both Cain and Moore would require Senate confirmation. Sen. John Thune, the GOP Whip, said lawmakers would have questions for both men.
“They all have to go through the process and see whether or not they’re a good fit — both in terms of qualifications and just the experience and everything else,” Thune said. “You want somebody on the Fed to be somebody who’s very knowledgeable on economic issues.”
The seven-member Fed board along, with presidents of the Fed’s regional banks, plays a critical role in the U.S. economy, holding regular meetings to debate and vote on interest rates that affect everything from savings accounts to mortgages.
After Trump announced his intention to nominate Moore to the Fed board, there have been published reports stating that Moore had a lien of more than $75,000 filed against him in January 2018 for unpaid taxes and he has fallen behind on alimony and child support payments to his ex-wife.
However, Larry Kudlow, head of the president’s National Economic Council, told reporters Wednesday that Trump is “fully behind” Moore’s nomination. Moore served as a campaign adviser to Trump in 2016, helping to formulate Trump’s tax cut plan.
Moore has been highly critical of the Federal Reserve, saying in December that Chairman Jerome Powell should be fired for backing a fourth Fed interest rate hike that month. Moore now says that comment was written “in a time of anger.”
Cain met with Trump in January to discuss a possible nomination to the Fed board but at the time the White House said that Trump was looking at multiple candidates for the two Fed openings.
Cain, who served for a number of years on the board of directors of the Fed’s Kansas City regional bank, has also been critical of the central bank’s policies.
In a 2012 Wall Street Journal column, Cain said that the Fed’s policies manipulated the value of the dollar. In the article, he advocated a return to the gold standard as a way to control inflation, a position taken by other Fed critics but which many economists call unworkable.
Cain in September co-founded a pro-Trump super political action committee, America Fighting Back PAC. It features a photo of the president on its website and says: “We must protect Donald Trump and his agenda from impeachment.”
Cain dropped out of the race for the 2012 Republican presidential nomination after allegations that he had engaged in sexual harassment when he led the National Restaurant Association in the 1990s. An Atlanta woman also said she had conducted an extramarital affair with Cain for more than 13 years.
Cain called the allegations false but said he had “made mistakes in my life.” Before leaving the race, Cain had put forward a “9-9-9” tax plan that called for replacing the current tax system with a flat 9 percent business and individual income tax, and a 9 percent sales tax.
Trump has been highly critical Powell, the person he picked to be Fed chairman after deciding that he would not renominate Janet Yellen. In addition to selecting Powell for the top job, Trump has nominated all the current Fed board members with the exception of Lael Brainard, who was nominated by Barack Obama.
Trump’s other nominees have held views more in line with traditional selections for the Fed board. The White House announced Thursday that Trump was nominating Michelle Bowman, a Kansas banking regulator, for a full 14-year term on the Fed. She joined the Fed last year, taking over a term that will end next year.
Trump, however, has grown increasingly unhappy with Fed decisions under Powell’s direction, especially after the stock market took a nosedive last year as the central bank was hiking rates four times. Since January, the Fed has reversed course and now says it expects no further rates hikes this year.
Even with that change, Trump has continued to be critical. Kudlow last week called for the Fed not only to pause rate hikes but to actually cut rates by one-half percentage point, saying he and the president believed that was the best course of action.
In a tweet Thursday, Trump said the economy was looking very strong “despite the unnecessary and destructive actions taken by the Fed.”