Federal Reserve Chair Jerome Powell will attend oral arguments at the Supreme Court on November 1, 2023, regarding the attempted dismissal of Fed governor Lisa Cook. This attendance underscores Powell’s commitment to maintaining the independence of the Federal Reserve amid ongoing political pressures.
The Supreme Court previously allowed Cook to retain her position in October while preparing to hear arguments in this high-profile case. Powell’s presence is significant, as it reflects the central bank’s stance against potential political interference. Earlier this month, Powell disclosed that the Justice Department had served the Federal Reserve with grand jury subpoenas related to a $2.5 billion renovation of Fed buildings. These subpoenas followed a campaign by former President Donald Trump, who has publicly criticized Powell for not lowering interest rates further, labeling him as “too late” and “a major loser.”
The Federal Reserve has declined to comment on Powell’s participation in the Supreme Court proceedings, which were first reported by The Associated Press. NBC News has reached out to the White House for its perspective on the matter. Powell suggested that the potential indictment he faces is linked to his testimony before the Senate regarding the renovations, asserting that “those are pretexts.” He emphasized that the threat of criminal charges arises from the Federal Reserve’s commitment to setting interest rates based on public interest rather than political preferences.
In August, Trump announced his intention to remove Cook, citing accusations of mortgage fraud made by William Pulte, the Director of the Federal Housing Finance Agency. However, the Federal Reserve Act imposes restrictions on presidential authority to dismiss governors without substantiated evidence of wrongdoing. Cook has denied these allegations, and previous reports indicate that bank documents may contradict Trump’s claims.
Following Trump’s attempt to remove Cook, her attorney, Abbe Lowell, issued a statement asserting that Trump “has no authority to remove Federal Reserve Governor Lisa Cook.” Lowell characterized the attempt to terminate Cook’s position as lacking both factual and legal justification. Cook’s term as a Federal Reserve governor is set to conclude in January 2038, which adds further complexity to the ongoing legal proceedings.
As the Supreme Court prepares to deliberate on this case, the implications for the Federal Reserve’s autonomy and the interaction between politics and monetary policy remain significant. Powell’s attendance at the oral arguments not only highlights the importance of the case but also signifies the central bank’s resolve to uphold its independence in the face of external pressures.
