The Federal Reserve is one of the most powerful and important economic institutions in the country. The central bank sets interest rates, and thus wields enormous influence over job creation, wage growth, and inflation rates. It also plays a central role in regulating the financial industry. These policy decisions are made by a 12-member voting board, led by the Fed chair.
You'd expect lawmakers to pick the Fed chair with utmost seriousness.
But this is President Trump's America. So the decision is apparently being made through reality TV brown-nosing, personal feuds over bronze statues, and processes that resemble picking the lineup for your elementary school dodgeball team.
Janet Yellen is currently Fed chair, but her term expires in February. Her replacement must be nominated by the president and confirmed by the Senate. And on Tuesday, at a lunchtime sitdown with Republican Senate Leadership, Trump literally asked everyone to raise their hands for their preferred pick.
Some people in the room, like Sen. John Cornyn (R-Texas), declined to give details about the meeting. But Sen. Tim Scott (R-S.C.) said Trump specifically asked about Jerome Powell, a sitting Fed official, and John Taylor, a well-known conservative economist at Stanford University. Trump "didn't announce a winner, but I think Taylor won," Scott explained.
Another Republican at the meeting, Sen. Mike Rounds (S.D.) told reporters it wasn't clear who won, because most of the senators just smiled and didn't actually raise their hands.
Sen. Bob Corker (R-Tenn.), who's feuded with Trump and fiercely criticized his temperament and character, was also in the meeting. His assessment was blunt: "I don't think that's a very good way to pick a Fed chair so I declined to participate."
But wait, it gets better.
This may have been a seat-of-the-pants roll-call vote, but at least Trump asked actual lawmakers. On Wednesday, the president interrupted an interview with a Fox Business personality to get his opinion.
"Tell me who your preference is," Trump cajoled host Lou Dobbs. "My I constrain myself?" Dobbs responded, expressing discomfort with being "an ad hoc adviser to the president." But Trump cut him off: "You can even cut it out if you want. You don't have to. I would love to hear you. I only want that from people I respect."
Trump's needling got Dobbs to suggest that Yellen "might be worth keeping." Remarkably, Trump was not thrown off in the least by Dobbs' pick of someone other than Powell or Taylor. "[Yellen] was in my office three days ago," Trump said. "She was very impressive. I like her a lot. I mean, it's somebody that I am thinking about."
What's striking is that another nominee, Kevin Warsh, was supposedly a shoo-in for Fed chair just a few weeks ago.
Warsh is known to be a monetary hawk who champions higher interest rates. That's a preference near and dear to congressional Republicans, who are roundly opposed to Yellen for the same reason. Yet Warsh seems to have disappeared from the short list.
Maybe that's just due to Trump's famously mercurial nature. But it may also involve the last weird turn the Fed chair race took recently. Trump already placed a man named Randall Quarles as a Fed official specifically tasked with regulatory matters. And the Fed chair race has ginned up an old personal feud between Quarles and Warsh.
The two have vied for various government offices for years. But apparently their spat even involves a statue, of all things: Quarles' wife comes from a prominent family that wanted to donate a statue to the Fed, and Warsh was the Fed official at the time tasked with negotiating the matter. For a variety of bureaucratic and political reasons, the Fed was hesitant to accept the statue, and eventually hid it away in a nook in the building.
But for whatever reason, there's been bad blood ever since. Quarles "told friends that he doesn't think Warsh is qualified to lead the world's most powerful central bank," Bloomberg reported. He's "also concerned that Warsh would inject himself into regulatory policies that are meant to be the domain of the vice chairman." Treasury Secretary Steven Mnuchin is reportedly aware of Quarles' objections.
We don't know if the spat has influenced Trump's Fed chair pick. But given his reputation for prizing tribalism and personal loyalty above all, it would hardly be surprising.
So let's review the picture these anecdotes paint: The president is so vacuous and at a loss that he'll use a show of hands at lunch to decide the most important staffing decision in American economic policy. He may even be letting interpersonal spats dictate his thinking. Yet Trump is able to camouflage the fact that he has no idea what he's doing — or how to go about judging the decision — with a car salesman's self-confidence and gift for gab. And the "people [Trump] respects," the ones he wants to weigh in on, again, the most important staffing decision in economic policy, include bloviating television personalities.
It sounds like Taylor or Powell are the two most likely picks, though Yellen is still in the running. Taylor would be the down-the-line right-wing ideological choice. He favors less regulation and higher interest rates. Powell favors deregulation, but also supported Yellen's lower interest rates, which puts him closer to Trump's own quixotic leanings.
The White House says Trump will make his decision before Nov. 3. Whomever he chooses, we can all rest easy that "the president is taking that decision very seriously," as White House Press Secretary Sarah Sanders told reporters.