Time for Trump To Fight for Judy Shelton

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The New York Sun

Senator John Thune’s comments today suggesting that Judy Shelton lacks in the Senate the votes to be confirmed as a governor of the Federal Reserve certainly strike us as important. The latest version of the story, carried by Bloomberg, quotes Mr. Thune, the Republican whip in the upper chamber, as saying “we’re still working on it,” adding: “It’s the Federal Reserve. It’s important. So obviously we want to get it done.”

We take that as a signal, to the White House as well as to the Senate, that it’s not over. Bloomberg’s Laura Litvan reports that Ms. Shelton is a priority for the White House, which is as it should be. Not only because Senators Mitt Romney and Susan Collins have said they’ll vote against Ms. Shelton but because Senators Lamar Alexander and Lisa Murkowski reportedly have yet to decide.

No doubt it’s a tight situation, given that the Republicans on the Senate Banking Committee were unanimous in Ms. Shelton’s favor. That majority included some GOP members who’d nursed doubts but took the time to speak directly with Ms. Shelton — and then voted for her. It turns out that those who take the trouble to converse with Ms. Shelton discover an economist quite different from what they expected.

Which is not surprising, given the hysteria that has greeted the nomination of Ms. Shelton. Earlier this month, more than three dozen alumni of the Federal Reserve issued an open letter against Ms. Shelton. “While we applaud the Board having a diversity of viewpoints represented at its table, Ms. Shelton’s views are so extreme and ill-considered as to be an unnecessary distraction from the tasks at hand,” the letter said.

In fact, Ms. Shelton’s views are not extreme. They have been held, either currently or in the past, by a majority of those who, in the years since the Fed was founded, have served either as its chairmen or governors. Not to mention the founders of our monetary system, including George Washington, Alexander Hamilton, and Thomas Jefferson. Their opposition to fiat money was far more “extreme” than Ms. Shelton’s.

The highest ranking signer of the anti-Shelton letter is a former vice chairman of the Fed, Alan Blinder, which is ironic. He was later the genius behind “Cash for Clunkers.” There’s a policy for you. At the moment, his claim to fame is as an occasional contributor to the Wall Street Journal’s op-ed page. He is welcomed there though he dissents from its center right views — yet he is unwilling to countenance a dissenter at the Fed.

“God Help Us if Judy Shelton Joins the Fed” is the headline the Times put over a piece by Steve Rattner after she was approved by the Senate Banking Committee. You’d think we were threatened with forty days and forty nights of rain. Critics are on Ms. Shelton’s case for supposedly abandoning the gold standard views they abhor in favor of, at least for the moment, easy money that they themselves support.

We don’t mind saying we were disappointed in Mr. Romney’s decision on Ms. Shelton (Utah is so eager for the gold standard that it made gold legal tender in the Beehive State). Senator Susan Collins, of whom we’re an abiding fan, at least has the excuse of being in a tight race. We’d encourage Ms. Collins, though, to meet with Ms. Shelton and keep an open mind. The two are logical policy allies.

Most of all, we hope President Trump gets into this fray, and fast, given the Senate schedule between now and the election. The White House did put out a statement today saying that the President is “firmly behind his nomination of Judy Shelton, who is exceptionally qualified.” We’d like to think that she’s a first step toward redeeming the promises on monetary reform he made during his 2016 winning campaign.

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Senate Banking Committee is the body that sent Ms. Shelton’s nomination to the floor. The name of the committee was given incorrectly in the bulldog.


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