Top White House economic adviser Gary Cohn is unlikely to be nominated as Federal Reserve chairman because he criticized President Trump’s response to violent white supremacists last month, two people familiar with the decision-making process said, upending the search for who will control the most powerful economic post in the world.
Trump is now leaning strongly against nominating Cohn, director of the White House National Economic Council, said the people, who spoke on the condition of anonymity because they were not authorized to discuss internal deliberations. It is unclear who would be the next most likely option for Trump's pick for Fed chair.
“The president is considering several candidates,” said one of the people, a senior administration official.
Cohn last month told the Financial Times that the White House should have responded differently to the white supremacist rally in Charlottesville. Trump was initially dismissive of the rally, saying there were some “fine people” who marched with the neo-Nazis, and saying “both sides” were to blame for violence at the event, where someone protesting the white supremacists was killed.
Cohn is Jewish and has donated large sums of money to Jewish charities and causes.
“This administration can and must do better in consistently and unequivocally condemning these groups and do everything we can to heal the deep divisions that exist in our communities,” Cohn said last month in an interview with the Financial Times.
Trump was livid at the criticism, complaining to other White House aides that Cohn was being disloyal.
People close to Trump said no decisions have been made, and he is known for being hot, then cold, then hot again on specific candidates for jobs. He places a high premium on personal loyalty, however, potentially imperiling Cohn’s chances of getting the job.
Federal Reserve Chair Janet L. Yellen has a four-year term that ends in February. She was nominated by President Barack Obama. Trump has said he is considering nominating her to another term, but last month she gave a detailed speech defending all of the steps regulators have taken since the financial crisis, essentially rebuking many of the deregulatory positions he has called for.
The Wall Street Journal first reported on Wednesday that Cohn was unlikely to get the job.
Cohn is one of the most well-respected members of the White House’s economic team, with stock markets initially rallying last month when it became clear he wouldn’t resign over Trump’s response to Charlottesville. He is working on the tax cut plan and an effort to create a $1 trillion infrastructure package. Both of these initiatives face strong head winds in Congress, but he has built a drama-free team within the White House and often exudes optimism that they will be able to reach some deals.
Still, Cohn is known for speaking his mind. He has complained about Washington and even working in the White House to friends in New York, saying the process can be frustrating and hard to navigate.
Fed watchers think other candidates could include John Taylor of Stanford University, former Fed governor Kevin Warsh, Glenn Hubbard of Columbia University and current Fed Governor Jerome Powell.
Cohn, the former president of Goldman Sachs, had given donations to Democrats before joining the Trump administration and was never accepted by many conservatives. He has also made numerous enemies inside the White House, encouraging Trump not to follow through on advice from some aides to rip up U.S. trade agreements because of the impact it could have on the economy.
Trump initially often boasted of Cohn’s past success and wealth, saying he gave up millions of dollars on Wall Street to join his administration. And Cohn has served as a close aide to Trump both inside the White House and in meetings with foreign leaders.