Donald Trump’s attempt to take control of the independent Federal Reserve is both legally wrong and economically disastrous. He must be stopped. The Fed determines monetary policy by setting interest rates, the price of money, which should be handled by expert and objective economists, not politicians.
After months of sending signals that he had his sights on the Fed and Chair Jay Powell, Trump this week took a direct shot at the central bank, purporting to fire Federal Reserve Governor Lisa Cook over ginned-up allegations of mortgage fraud, though everyone knows his is a fundamentally ideological dispute. Cook, for her part, did the right thing and pointed out to Trump that he has no power to fire her and that she won’t resign, saying that will go to court.
Cook holding the line protects a crucial pillar of our economic stability.
There’s a reason that the U.S. Supreme Court, despite its recent trajectory of subservience to Trump‘s political agenda, carved the Fed specifically out from its ruling allowing Trump to fire independent agency heads and directors. No matter how bought into Trumpian ideology anyone might be, most people with even a basic grasp of the global economic system are well aware that interfering with the Fed’s independence is a third rail that could set off some major and uncontrollable repercussions if touched.
Trump’s chaotic tariff regime may be raising prices for consumers, undermining global confidence in the American market and the dollar and all that, but it will seem like child’s play in the event that Trump is really able to wrangle the central bank under his control. Even doctorate-level professional economists have a hard time gaming out what exactly happens then, but everyone agrees that it would be catastrophic. Every government that has ever mucked with the professionalism of its central bank has come to regret it in the end.
Adding insult to injury is Trump‘s excuse, this spurious accusation of mortgage fraud. If that sounds familiar, it’s because he’s reached for that tool before, attempting to tar New York Attorney General Tish James with the same accusation for equally political ends.
In that case, Trump flunkie Ed Martin tried to force James’ resignation. Both of these efforts to weaponize the government against political enemies were facilitated by Bill Pulte, a Trump donor and now director of the Federal Housing Finance Agency, who embodies the Trumpworld principle of advancing the leader’s interests at all cost.
These Trump political appointees do not view themselves as stewards of a responsible and professional government that is primarily geared towards helping the public and ensuring the rule of law. No, they understand themselves to be foot soldiers in the war that Trump is fighting against the American system as a whole.
These accusations of supposed mortgage fraud were simply the easiest hooks for the pursuit of Cook and James, two Black women who happen to be obstacles in the path of Trump‘s desire for total control and absolute immunity. If it had not been the weak charges of mortgage fraud, it would have been something else; the important thing was to find something that could act as a pretext for the targeting of perceived enemies.
The person who actually may be engaged in official misconduct could be Pulte himself, and that should be something that attracts the attention of Congress and the Justice Department, if not in the imminent future then at some point when the rule of law has been reestablished in this country. In the meantime, this intimidation must fail, for the good of the entire global economy and the basic survival of our democratic form of government.
