Trump’s war on the Federal Reserve heads to the Supreme Court next week |
On Sunday evening, Federal Reserve chair Jerome Powell posted an unusual video message to the nation, revealing that the Trump administration opened a criminal investigation into him — ostensibly because of a dispute over renovations to a Federal Reserve building.
In reality, this investigation is almost certainly a pretext seeking to hound Powell out of office. President Donald Trump has criticized Powell for not lowering interest rates as quickly as Trump would prefer, and he’s threatened to fire Powell — something Trump is not allowed to do under federal law without sufficient cause. So, the criminal investigation into Powell appears to be a bad faith effort to gin up charges that could supply such cause.
Indeed, one reason why the Trump administration’s investigation of Powell is so suspicious is because this isn’t the first time this administration has levied spurious charges against one of the Fed’s leaders in an effort to push them out of office. Next week, the Supreme Court plans to hear Trump v. Cook, which involves a nearly identical effort to push out one of Powell’s colleagues on the Fed’s Board of Governors.
As a general rule, the Supreme Court’s Republican majority believes that Trump should have sweeping authority to fire government officials who don’t work in Congress or the courts.
Later this term, in Trump v. Slaughter, the Court is widely expected to overrule 90 years of precedent establishing that Congress may create “independent” federal agencies whose leaders may only be fired by the president for cause. Last July, the Court’s Republicans also permitted the Trump administration to fire nearly half of the Department of Education’s employees.
In May, however, the Court signaled that the leaders of one federal agency, the Fed, are special. Admittedly, the Court’s explanation of why they are special, which came in a decision called Trump v. Wilcox, is gobbledygook. But it ultimately does not matter very much why the justices decide to do something if they are committed to it. And this Court does appear committed to the idea that Trump cannot fire members of the Fed’s Board of Governors.
Which brings us to Cook, a case the Court will hear on January 21, which tests whether the justices will actually let Trump fire a Fed governor and get away with it. Unlike Slaughter, however, where........