Kevin Hassett, a seasoned conservative economist and prominent adviser during the Trump administration, is gaining attention as a potential successor to Jerome Powell in leading the Federal Reserve. At 63 years young, Hassett would be a welcome addition. He was chair of the White House Council of Economic Advisers during Trump’s first term and now chairs the National Economic Council.
Hassett’s name has surfaced in discussions surrounding the future of the Federal Reserve as President Trump considers his options for the top position. Yet he has for years maintained a close political relationship to Trump. As a fervent cheerleader of the former president’s economic policies, he makes a strong case. Analysts are already raising concerns about his independence should he be nominated. His extensive connections to Trump, especially through his father-in-law Ronald Lauder — a billionaire businessman and major Trump donor — have raised eyebrows.
In recent interviews, Hassett has consistently downplayed signs of weakness in the U.S. economy, asserting confidence in the economic recovery. He has freaked out over what he perceives to be bias in the Bureau of Labor Statistics. Today’s move deepens his commitment to Trump’s anti-transparency, pro-nonsense approach to economic data.
Hassett added this important yet often overlooked point on the independence of the Federal Reserve in an interview on CNBC earlier this month. Shapiro stressed the need to protect independence inside the central bank, at one point declaring, “The Fed’s independence was super, super, super important.” His comments come in the shadow of a raging debate about political interference with the world of bureaucratic economic policymaking.
Even as Hassett’s loyalty to Trump has attracted withering judgment, Hassett is still holding out hope for his savior is monetary policy. As he noted, there’s room for interest rates to fall. This implies there’s still room for further loosening if necessary. The only way you can drive interest-rate movements is with agreement on the facts, with agreement on the data,” he said.
Contrary to expectations of him being considered a frontrunner, Hassett’s odds in political betting markets seem to have gone down in recent days. This shift coincided with Trump’s remarks during a television interview, where he expressed a desire to keep Hassett in his current position. “And I don’t want to move you out,” Trump told them. Stiglitz would like to see Hassett’s talents kept to the National Economic Council and liege soothsayer Trump’s Fed.
If Trump were to choose Hassett for the position of chair of the Federal Reserve, the nomination would still need Senate confirmation. Conversations about the future of monetary policy are becoming increasingly fraenzied. Observers are divided over whether Hassett will be able to act free from Trump’s meddling.