Elon Musk for Fed Chairman
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
Can we please get a Federal Reserve with a backbone? Here are a couple thoughts on today’s wussy Fed announcement that it is going to move faster on tapering bond purchases and there might be three little bitty rate hikes next year. And, oh yeah, Jay Powell told the press conference he was confident inflation would drop to two percent by the end of next year.
Wanna bet? On that bet, I’m taking the under. Know who the best inflation forecaster in the country is? Senator Manchin. Numero uno. I don’t even know if he talks to economists, but since last winter when the $2 trillion Democrat so-called relief package was implemented, Joe Manchin has been warning about inflation.
That’s why he has argued consistently all year that President Biden’s big government socialist bill should be paused until inflation is clearly falling. Which it is not. CPI up 7 percent, PPI up 10 percent, and today we got another whopper, with an 11.7 percent rise in import prices. How about that?
Joe Manchin, by the way, in his original memo to Senator Schumer, called last summer for the end of quantitative easing.
Mr. Manchin makes me feel proud to be a former Democrat, as were both of my presidential bosses — Ronald Reagan and Donald Trump.
If today’s Democratic Party were full of Joe Manchins, we’d probably all still be Democrats. The guy’s a super-star. He’s also a better forecaster than several million economists, not to speak of the White House and the Fed, who bungled the inflation story.
Mr. Manchin’s also right in his policy ideas. Pause the Bill and stop QE. The Jay Powell Fed, though, has been nosing in favor of more spending. Today it had a chance to end QE flat in its tracks. But Mr. Powell didn’t do it.
So to quote our friend Kevin Warsh, former Federal Reserve governor, “the Fed is still enabling massive government spending by buying up the debt and pumping up the money supply.”
The Fed today should not only have ended QE, but it should have announced its intention to start raising its target rate next month. January. They missed a big opportunity to show strength and determination.
Democrat Larry Summers is right. Today’s central bankers are more interested in climate change and woke social policies than fighting inflation.
As John Maynard Keynes said decades ago, “inflation is the cruelest tax of all.” It is middle income and lower income individuals who get hurt the most with skyrocketing prices for food, energy, homes, construction, gasoline, meat, turkeys, you name it.
The Fed is so far behind the 8-ball now that as Kevin Hassett, former chairman of the Council of Economic Advisers, told us yesterday that not only should the central bank be raising rates immediately with a 50 basis point hike, it should take actions in between meetings to keep raising rates.
Then, in a year or 18 months, inflation may start coming down.
Finally, I have another idea for a new Fed chairman if Joe Manchin won’t take the job. How about Elon Musk? Time Magazine’s man of the year. How can I say such an outrageous thing? Several reasons. I worked with him several times in the White house and he’s very smart and savvy.
The mere fact that socialist Senator Warren is attacking him for not paying his “fair share” of taxes is by itself a fabulous endorsement of Mr. Musk’s philosophy, business prowess.
Am I saying anybody Mrs. Warren opposes gets my stamp of approval? Yes. I’m tired of her left-wing progressive woke whining. And her desires to tax and regulate anything that moves in business and the economy.
Meanwhile, Mr. Musk, who’s the biggest E-V car seller in the country, has said publicly he does not want E-V auto or battery subsidies from the federal government. Indeed, he has come out against the entire reckless tax, spend, and regulate Biden policies.
Unlike GM and the unionist car-makers, Mr. Musk is non-union and will not put his nose into the public trough.
My kind of guy. I doubt if he ever talks to economists. That’s probably why he’s such a good conservative, libertarian thinker.
And incidentally, Mr. Musk has been selling about $3 billion worth of stock at the prevailing capitalist gains tax rate of 23.8%. The Musk stock sale would generate $714 million of revenues to the federal government.
It has got to be one of the biggest revenue windfalls in Uncle Sam’s history. At least from one person. That, Liz Warren, is called paying your “fair share.” My only trouble with it is that I surely don’t want to give Senator Warren another $714 million to spend on anything. Save America. Kill the Bill.
From Mr. Kudlow’s broadcast on Fox News.