Federal Reserve Governor Keeps Job Amid Trump Removal Attempt
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Donald Trump’s attempt to fire Federal Reserve Governor Lisa Cook is currently stalled. The US Supreme Court has deferred action on the Department of Justice’s request to allow the president to fire Cook, at least until oral arguments in January. A lower court judge had already temporarily blocked Trump from firing her.
This situation raises concerns about the independence of the Federal reserve. Trump has been publicly critical of the Fed, installed an ally on the board, and attempted to remove Cook, alleging mortgage fraud (which she denies). This is the first time a president has attempted to fire a Fed official.
The legal basis for removing a Fed governor is unclear. The 1913 Federal Reserve Act allows removal “for cause,” but doesn’t define what constitutes “cause” or establish procedures. This has never been tested in court.
Lisa Cook is suing Trump, arguing his claims are a pretext for firing her due to her monetary policy positions. She is the first Black woman to serve as a Fed governor.