Kevin Warsh appointed as Federal Reserve Chair: A return to George W. Bush's economic policies?

Donald Trump has made a decisive economic move by appointing Kevin Warsh as Chairman of the Federal Reserve after Jerome Powell’s term ends. This decision comes after years of hints and regret expressed by Trump over not choosing Warsh in 2017. This appointment marks a clear shift in U.S. economic policy, reflecting a return to more conservative approaches toward federal intervention.

Career Path and Banking Experience

Kevin Warsh is a prominent American banker and economist who has spent many years in public service. Warsh was appointed to the Federal Reserve Board of Governors in 2006 under George W. Bush, becoming the youngest member to hold this position at the time. During his tenure during the global financial crisis, he gained extensive practical experience in managing financial crises and extraordinary monetary policies.

After leaving the Federal Reserve, Warsh moved to work as a senior economic advisor in the White House, where he directly influenced economic policy formulation. He became one of the most prominent economic figures within the Republican Party and earned a strong reputation as a traditional economic thinker.

Economic Vision and Firm Stances

Warsh is known for his firm stance and outright rejection of excessive monetary easing policies. He has become known among economic circles as a fierce critic of central bank policies that he considers too lenient. He sharply criticizes the large expansion of the federal budget and the massive government spending seen in the period following the COVID-19 pandemic.

Warsh strongly advocates for limiting the role of the central bank to purely monetary tasks. He vehemently opposes the Fed’s involvement in climate issues and social policies, arguing that these matters exceed the central bank’s authority. This position reflects a traditional economic philosophy focused on the independence of the central bank from broad political and social pressures.

Historical Context: Waiting Eight Years

Warsh was a strong candidate to become Federal Reserve Chair in 2017 before Trump chose Jerome Powell. Trump later expressed clear regret over this decision, considering that choosing Powell was a strategic mistake. Warsh remained active in economic and political circles, waiting for his opportunity.

Now, with Powell’s term ending, Warsh returns to take the role that Trump has long considered the best option. This appointment is seen as a correction of a previous decision, according to Trump, and indicates a clear desire to shift U.S. monetary policy toward a more conservative and inflation-fighting stance.