The most obsessive political trivia fans among you might recall a colorful fellow named Herman Cain. He was once the chief executive officer of the Godfather’s Pizza chain, and on that basis was briefly a serious contender for the Republican party’s presidential nomination way back in 2012, but his candidacy ended with credible allegations by four different women of sexual misbehavior and a general realization that on economic matters he didn’t really know what the hell he was talking about.
It’s worth remembering, because Cain is back in the news. Numerous press reports indicate he’s President’s Donald Trump next pick for the Federal Reserve Board, and there’s already some fuss about it.
The Federal Reserve Board is a big deal, as it decides how many dollars are needed to run the nation’s multi-gazillion dollar or so economy without causing either economic stagnation or inflation, or the stagflation we went through back in the ’70s. Maintaining that elusive optimum of money supply and interest rates to sustain a full-employment economy without raising prices is a tricky business, probably best left to people with doctoral degrees from such institutions as the University of Chicago’s Nobel-prize-laden School of Economics, and there is reason to doubt Cain is up to the task.
Cain did once run a once-successful pizza chain, which we have to admit made a pretty good pizza, and he also served as the Fed’s Kansas City district director during the booming ’90s. Even so, we have our doubts.
Way back in ’12 Cain was briefly a presidential contender with his “nine, nine, nine” economic plan, which would have imposed a nine percent corporate, income and sales tax on America. It was a catchy and easy-to-remember slogan, but most Republican voters decided it was unlikely that the optimum corporate income tax rates were both nine, and a nine percent federal sales tax was downright weird in a Republican presidential primary race. Throw in the serial allegations of sexual misbehavior, and that’s why you haven’t hear much about Cain in the past several years.
It’s not surprising, however, that Cain is once again back in the news. The Fed can fire up the stock markets with low interest rates, at least for awhile before the inflation kicks in, Cain is clearly willing to go along with that, and Trump probably isn’t at all concerned with sex scandals. The economy’s going along fairly smoothly these days, to a point that Trump’s appointed Fed chairman has said he won’t be raising interest rates, which has clearly infuriated the President. There are hard-to-explain reasons why the money supply and interest rates should be at a certain level to sustain the national economy over the coming the decades, but it’s far easier to explain why Trump would want to keep the money flowing through the 2020 election.
— Bud Norman