Cain withdraws from Fed consideration

“My friend Herman Cain, a truly wonderful man, has asked me not to nominate him for a seat on the Federal Reserve Board. I will respect his wishes. Herman is a great American who truly loves our Country!” Trump tweeted.

 

{mosads}Four Republican senators said they would not support Cain, all but dooming his chances of confirmation. The decision marks a setback for Trump’s effort to install allies at the central bank, which has traditionally been independent of politics.

 

GOP critics of Cain argued he was unfit to serve on the Fed board, due to either past misconduct allegations or his outspoken support for Trump.

 

As recently as last week, the former 2012 presidential candidate said he would not withdraw from consideration, telling The Wall Street Journal he was “very committed” to sticking with the nomination process.

 

Cain also said in a Thursday interview with Fox Business Network that he “won’t run away from criticism” and that withdrawing was “not in my nature.”

 

Trump said on April 4 he had chosen Cain for a Fed board seat, but the president never formally nominated him to the post. Less than a week later, Trump called Cain a “wonderful man” but said the former Godfather’s Pizza CEO “will make that determination” whether to move forward with the process after sexual misconduct accusations resurfaced.

 

But throughout the process, White House officials said Trump was interested in seeing the nomination through as long as Cain was as well.

“I think at the end of the day, it will probably be up to Herman Cain to stay in that process or not,” top White House economic adviser Larry Kudlow said last week. “As far as we’re concerned, he’s still in that process and it’s proceeding in an orderly way.”

Trump’s selection of Cain came amid mounting frustration over the Fed’s decision to raise interest rates on multiple occasions in 2018, which the president argues has dampened economic growth. The Fed said it raised rates to guard against possible inflation and prepare for a future economic downturn.

Nonetheless, Trump has publicly attacked the Fed and his handpicked chairman, Jerome Powell, over the rate hikes in a break with his predecessors who traditionally did not publicly weigh in on Fed decisionmaking.

Republican senators quickly voiced concerns about Cain’s character and qualifications, particularly the allegations of sexual harassment that derailed his 2012 presidential bid.

Cain was accused of harassment by four women who worked for him at the National Restaurant Association, a Washington, D.C., trade group he led from 1996-1998. He has denied all of the allegations, but reached legal settlements with two of the accusers.

In the 1990s, Cain serve as chairman of the board of the Federal Reserve Bank of Kansas City, a group of business leaders and community activists who advised the regional Fed branch on the economy.

Some Republicans said Cain’s service at the Kansas City Fed qualified him for a seat on the central bank’s board. Others noted that Cain’s position was largely advisory and had little to do with running U.S. monetary policy.

GOP senators were also concerned about Cain’s close ties to Trump, including his leadership of a super PAC supporting the president’s reelection.

GOP Sens. Lisa Murkowski (Alaska), Cory Gardner (Colo.), Mitt Romney (Utah) and Kevin Cramer (N.D.) announced two weeks ago that they would vote against Cain, while other Republicans privately asked Trump to choose a different candidate.

With four of the 53 Senate Republicans opposed to his nomination, Cain would have needed unanimous support from the rest of the GOP conference and at least one Democrat to be confirmed, which was highly unlikely.

Senators have stymied three of Trump’s potential Fed appointments, including Cain.

Trump’s nomination of Carnegie Mellon professor Marvin Goodfriend has stalled in the Senate as conservatives raised questions about his past controversial monetary policy proposals.

And the president withdrew his nomination of former Fed director Nellie Liang, a Democrat, after Republicans expressed concerns over her support for tougher financial regulations.

The president is also eyeing conservative economic commentator Stephen Moore for another open seat on the Fed board.

Moore has also come under fire for his political support for Trump and controversial past writings, which has also raised doubts about his chances for confirmation. But Moore thus far has not experienced an outpouring of opposition from Republican senators like Cain had.

Moore also boasts deep ties to Republican politicians after spending decades advocating conservative economic policies. His Beltway experience could help sell skeptical GOP senators on his credentials.

—Sylvan Lane contributed. Updated at 1:19 p.m.