Supreme Court to Hear Case on President Trump’s Effort to Hold Federal Reserve Governor Lisa Cook Accountable

"...President Donald Trump launched his second term by seeking to usurp Congress’ authority and challenge a nearly century-old legal precedent that shields independent executive branch agencies and the congressionally-confirmed officers who lead them from presidential overreach...."

"...The world will be watching as the Court considers Trump’s self-granted prerogative to bulldoze Congress in order to assert his own political will over a central bank that is critically important to the global economy...."

"...Cook’s case is about maintaining Federal Reserve independence, protecting consequential monetary policy from presidential influence and partisan policy setting...."

"...It’s also about the ways in which Trump throughout the first year of his second term has crushed congressional authority and concentrated more and more power within the executive branch...."

"...The crux of the pre-Trump definition of independent agencies is that Congress designed them to be insulated from partisanship, and the president does not control them...."

"...The big global picture here is that this Supreme Court has been very intent and acted to bolster executive power at Congress’s expense...."

"...Now, the Supreme Court’s conservative majority has put itself in an awkward position on the Cook case, where it must choose either to prove that the Fed is not the same type of entity as the others the Court has allowed Trump to gut, or greenlight Trump’s attempt to remove Cook...."

"...Allowing Cook’s removal will give a stamp of approval to the president’s open threats to effectively rule the Fed with potentially devastating consequences...."

"...That the Supreme Court is even hearing oral arguments or received full briefings on this emergency docket case is unusual, said Binder, and signaled that the court might be fidgety about the implications of its past rulings that uphold Trump’s unilateral control over executive branch agencies...."

"...When the Department of Justice subpoenaed the Fed, part of an investigation into whether Federal Reserve Chair Jerome Powell lied to Congress while testifying about the cost of renovations of two Fed buildings, the Trump administration may have overplayed its hand...."

"...Legal and financial experts saw the investigation as a transparent bid to pressure Powell specifically, and Fed leadership more broadly, to align its monetary policy with the president’s wishes...."

"...If the Court decides Cook’s case with a narrow ruling that doesn’t address broader questions of Fed independence, Michigan’s Kress said, Congress could act legislatively...."

"...But at least in the case of the Powell investigation, Congress has shown signs of life...."

"...Senators from Trump’s own party vowed to block any of the president’s nominees to the Federal Reserve, including the president’s candidate to chair the board when Powell’s leadership term ends in May...."

"...We’re seeing what Congress can do, said Binder, and specifically what the president’s party can do in the Senate, given that those are the folks who will make or break the president’s ability to appoint a new chair [and] fill up the board with people who are going to be more amenable to his pressure for a lower rate...."