That’s right, Kevin Hassett is once more the center of attention! This experienced economist and former chair of the White House Council of Economic Advisers is becoming a likely frontrunner for the job of Federal Reserve Chair. At 63 years old, Hassett currently leads the National Economic Council and holds a fellowship at the Hoover Institution, a right-leaning think tank. That’s in part due to his long-standing association with Donald Trump. This relationship—heightened throughout the course of Trump’s first term—sets him up to be a central player in any conversation about monetary policy.
During his tenure as chair of the Council of Economic Advisers, Hassett was a staunch defender of Trump’s economic policies. He has repeatedly dismissed data that suggested underlying cracks were forming in the U.S. economy, to match the administration’s rosy projections. His enthusiastic praise for Trump’s economic plans has raised the eyebrows of both far-right pundits and progressive economists alike.
Hassett’s name surfaced as a candidate for the Fed chair position during Trump’s initial term. Most recently, he has returned to the forefront of discussions about the central bank’s leadership in the continuing debate over how best to ensure economic stability without inflation. Despite his qualifications, some within the Trump administration have expressed doubts about Hassett’s ability to lead the Federal Reserve effectively. Concerns quickly shifted to the question of whether his loyalty to Trump would permit him to act independently.
Hassett continues to be influential in economic policy debates. As a board member of UPS, he has certainly gotten an up-close view of private sector dynamics. At a time when our greenhouse gas emissions are still rising, he would tame the economy to protect our planet. In a recent, impromptu CNBC interview, he addressed concerns about the Fed’s independence.
“The way you’ve got to drive interest-rate movements is with consensus based on the facts and the data,” – Kevin Hassett.
In his keynote, Hassett stressed the need for consensus on the facts to chart a course on future interest rate hikes. Perhaps most importantly, he underscored the idea that interest rates have potentially quite a bit further to fall. If confirmed as Fed chair, he seems prepared to favor measures that stimulate economic growth.
Trump has publicly expressed confidence in Hassett’s capabilities, stating, “I actually want to keep you where you are,” indicating his preference for Hassett to remain in his current role rather than pursue the Fed chair position. The former president couldn’t say enough about Hassett, calling him “a man who’s been there a long time.” This further demonstrates Hassett’s deep experience and strong understanding of economic policy.
Despite Trump’s endorsement, analysts remain cautious about Hassett’s potential appointment. Some are wondering about his loyalty to Trump and if it would affect his judgment on the Federal Reserve board. The independence of the central bank is considered by many to be of utmost importance to public trust and effective monetary policy.
Hassett’s assertion of the Fed’s independence echoes sentiments shared by many economists who believe that political affiliations should not influence monetary policy. His comments reflect a recognition that the right kind of balance is necessary to move our jumpy, nervous economy. He does this so that the Federal Reserve can make difficult decisions, free from outside political pressure or obligation.
As discussions continue regarding potential candidates for the Fed chair position, Kevin Hassett’s background and experience make him a noteworthy contender. His history of supporting Trump’s economic policies juxtaposed with his recognition of the need for an independent central bank creates a nuanced profile that will be closely examined by policymakers and analysts alike.