Kevin Warsh: the man who will replace Jerome Powell as Fed chair

President Donald Trump has selected his replacement for Federal Reserve chair: Kevin Warsh will take over the Fed from current Chair Jerome Powell, whose term ends in April. Trump previously discussed firing Powell, though he has since walked these comments back.

Warsh, a former member of the Fed's Board of Governors, was long considered the top candidate for the job. He will now be taking over a sector of the government that Trump has publicly gone after.

Warsh's beginnings

Warsh, 55, is a native of Albany, New York, and completed his undergraduate work at Stanford University, later earning his J.D. at Harvard University. Following college, he worked as a vice president and executive director for Morgan Stanley before working as an "economic adviser to President George W. Bush from 2002 to 2006 and a governor of the Federal Reserve Board from 2006 to 2011," said Business Insider.

The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

Like Powell, Warsh "does not have a graduate degree in economics," said CNN. But during his time on the Fed's board, he "helped coordinate the sale of Bear Stearns to JPMorgan Chase." Not all was positive, though, as Warsh also "allowed Lehman Brothers to go under in 2008, a watershed moment for global financial markets." Warsh was an adviser on Trump's 2024 transition team and is currently a "distinguished economics fellow at the Hoover Institution, a conservative think tank." He is already a favorite of Trump's; the president reportedly considered him for Treasury secretary during his second term and had also considered him to run the Fed during his first term.

Warsh's economic views

When Warsh takes control of the Fed, he could significantly alter the way the nation's central bank is run. He previously wrote in an op-ed that recent inflation was caused by a "government that spent too much and a central bank that printed too much." This opinion isn't surprising coming from Warsh, as he has "long established himself as a so-called inflation hawk, who was worried about price pressures," said The New York Times. But most conventional economists do not agree with Warsh's view of inflation, and instead "attribute inflation's eruption in 2021 mostly to pandemic-induced shocks to demand and supply," said CNN.

Then there is the question of interest rates. Powell has previously been known for his willingness to allow rates to remain high to combat inflation, and Warsh is "widely considered to be even more hawkish" than Powell, said CBS News. But more recently, Warsh has changed his tune, and "publicly backed the need for interest rate cuts," said the Times, based on Trump's demand. Warsh has argued, against the wisdom of most economists, that Trump's tariffs "will not lead to persistently higher inflation." And despite his prior views on interest rates, Warsh has maintained that his "current support for lower interest rates is consistent with his earlier stance."

There are also questions as to how fast Powell could actually become Fed chair, a role that requires Senate confirmation. At least one GOP senator, North Carolina's Thom Tillis, has said he will “oppose President Donald Trump's Federal Reserve chair pick until a Justice Department probe into current Fed chief Jerome Powell 'is fully and transparently resolved,'" said Politico. Republicans have a 13-11 majority on the Senate Banking Committee; this means if Tillis joined every Democrat in opposing Warsh, his nomination would stall.