Kevin Warsh Is No JFK Jr.

Kevin Warsh is highly qualified to be Chairman of the Federal Reserve. He has demonstrated this in many ways, but there is one that stands out and can be summarized in four words: “Inflation is a choice.”

In those four words, he told the truth about inflation, Federal Reserve policy, the incompetence of Chairman Powell, and what few in the media — and apparently none in Congress — understand. Inflation is, and always has been, a function of the Federal Reserve creating money at a rate that exceeds the growing economy’s capacity to absorb it. As Milton Friedman put it, “inflation is always and everywhere a monetary phenomenon.”

Warsh made this case at length in a July 2025 Hoover Institution interview, and he repeated it plainly in his opening statement before the Senate Banking Committee: “Inflation is a choice, and the Fed must take responsibility for it.”The Federal Reserve, he said, is solely responsible for price stability — not the President, not Congress, not corporate pricing desks. That is correct. That is also, apparently, too nuanced for a Senate hearing.

And this, in my view, is true courage. To say for the record, in advance, that if you are confirmed you and you alone will be responsible for stable prices is courageous. Refusing to answer silly, soundbite questions designed to provoke President Trump are false equivalencies.

A Hearing That Missed the Point

Unfortunately, the Democrats on the Senate Banking Committee failed to understand what was before them. Several of President Trump’s prior appointments were unqualified. This one is not. Furthermore, this appointment is potentially the most consequential he will make. We should be grateful he got it right — and behave accordingly.

There were serious questions to be had. His view of rules-based monetary policy, the size of the Federal Reserve balance sheet, the regulation of the banking industry — all of these were well laid out in a recent Competitive Enterprise Institute analysis and deserve real scrutiny. Did Ranking Member Senator Warren go there? She did not.

Instead, she used her time to chase soundbites. She questioned his agreement with the Office of Government Ethics over undisclosed assets. She asked whether funds listed in his financial disclosure — the Juggernaut Fund and THSDFS LLC — had any ties to Jeffrey Epstein. Warsh’s name appeared in the publicly released Epstein files on a Christmas party invitation list. He has not been accused of any wrongdoing. Asking whether he is somehow still doing business with a dead man is not oversight. It is theater.

Then came the litmus test questions: Did Trump lose in 2020? Will you disagree with the President on economic policy? Why bother? In front of the committee was a highly qualified candidate whose confirmation is not seriously in doubt. The entire world depends on his success over the next several years. Why try to launch what is inevitable burdened by a damaged relationship with the President?

It is clear that the President is difficult, does not believe in Federal Reserve independence, and does not understand interest rates. But this is our reality. We need a Chairman who can navigate it. Picking a fight during the confirmation hearing is not a smart start.

The Irony Warren Cannot See

There is an obvious irony to Senator Warren’s approach. She charged Warsh with lacking the courage to be independent. But is refraining from commenting on political questions not a prerequisite for independence? If he had answered her questions about the 2020 election or declared his disagreements with Trump on the record, she would have used those answers against him too. He cannot win that game, and he was right not to play it.

Other senators used their time to criticize President Trump’s various statements about affordability and economic growth — as if no candidate could be qualified if nominated by a president who misstates facts. Independence does not mean agreeing or disagreeing with the President. It means making monetary decisions on the merits. Warsh said exactly that, repeatedly.

The Confusion Over Prices

Perhaps the most discouraging moment came when several senators failed to grasp the difference between inflation and the fluctuation of individual prices. Warsh tried more than once to explain it. Prices move up and down based on supply and demand — that is normal. General inflation, the kind the Federal Reserve is responsible for, is what happens when the value of money itself falls and nearly all prices rise together.

One senator insisted that rising insurance premiums were “inflation to her constituents.” That may be how it feels, but it is not what inflation means, and it is not within the Federal Reserve’s mandate to fix it. The Fed cannot legislate insurance markets into submission. Confusing the two leads to bad policy and misplaced blame.

The True Opportunity Democrats Are Missing

Here is what is genuinely frustrating: Kevin Warsh just handed Democrats a significant political gift — and they are either too focused on soundbites or simply not smart enough to see it.

First, he placed responsibility for the recent inflation squarely on the Federal Reserve. Democrats and Kamala Harris were saddled, inaccurately, with blame for inflation in 2024. Warsh’s framing gives them the intellectual ammunition to say: the Fed caused it, not us.

Second, his framework exposes the error in how Democrats have been positioning themselves on affordability. By promising to lower prices through executive action or spending programs, they are making commitments they cannot keep. If the Federal Reserve does not do its job, prices will rise regardless of what Congress does — and Democrats will own the result just as Republicans own it today.

Their pitch should be built on three things: a rules-based Federal Reserve that controls money supply growth, pro-growth policies that increase the supply of essential goods and services, and education reform that prepares the workforce for an economy reshaped by artificial intelligence. That is a governing agenda. Opposition theater is not.

One More Cost of This Behavior

Americans know that government does not work. Every encounter with the IRS, the Social Security Administration, or a federal agency reminds us of the gap between public services and private-sector performance. If we are ever to close that gap, we will need to recruit talented executives from the private sector and give them the authority to make real changes.

An obvious prerequisite is treating them with basic professional respect. Reducing a serious confirmation hearing to a parade of soundbites and insinuations will not encourage the talent we need to answer the call. Every capable person watching yesterday had one thought: Why would I ever subject myself to that?

Kevin Warsh is qualified. The hearing was not worthy of him. Democrats can do better — and they will need to, if they want to be taken seriously on economic policy.