Title: Trump Reportedly Asked GOP Leaders Whether He Should Fire Fed Chair Powell
Original Author: Adam Button, ForexLive
Original Source: https://www.forexlive.com/forex/trump-asked-gop-leaders-if-he-should-fire-powell-20250716/
In a recent report that has stirred waves in political and financial circles, it has been revealed that former President Donald Trump repeatedly questioned Republican congressional leaders during his time in office about whether he should fire Federal Reserve Chairman Jerome Powell. The revelation has added a new dimension to the already historic tensions between Trump and the Federal Reserve during his administration.
According to sources familiar with the matter, Trump frequently brought up the idea of removing Powell from his position during internal discussions. These inquiries were not isolated incidents, but rather a recurring topic throughout key moments in his presidency, especially in response to the Federal Reserve’s monetary policy decisions, which Trump often criticized publicly.
Background on Jerome Powell’s Appointment
Jerome Powell was appointed as Chair of the Federal Reserve by President Trump in November 2017, succeeding Janet Yellen. At the time, the nomination of Powell—a Republican and former investment banker who had served as a Fed governor since 2012—was seen as a move toward continuity rather than radical change. However, Trump’s relationship with Powell quickly deteriorated.
Key factors in Powell’s appointment:
– Served on the Federal Reserve Board of Governors since 2012
– Had broad bipartisan support at the time of nomination
– Was seen as a moderate voice within the Fed, with a reputation for pragmatism and balance
A Strained Relationship
Trump initially praised Powell following his confirmation by the Senate. However, as the Federal Reserve began raising interest rates in 2018 and 2019 in an effort to preemptively manage inflation, Trump grew increasingly frustrated with Powell’s decisions. The President believed the rate hikes were undermining economic growth and hurting markets.
Instances of tension included:
– Public comments criticizing Powell and the Fed for raising rates too quickly
– References to Powell as a potential threat to the U.S. economy
– Tweets accusing the Federal Reserve of acting like the “only problem” with the U.S. economy
Trump’s Desire to Remove Powell
The recently revealed reports confirm that Trump raised the idea of firing Powell during private meetings with Republican members of Congress and within his White House inner circle. According to sources cited by ForexLive, Trump felt that Powell’s monetary policy stance was directly impeding his administration’s economic agenda, particularly ahead of the 2020 re-election campaign.
Motivations behind the desire to dismiss Powell included:
– Frustration with the pace and timing of interest rate hikes
– A belief that monetary tightening conflicted with efforts to achieve higher GDP growth
– A perception that Powell was not doing enough to support the stock market and job creation
Legal Constraints
Despite the frequency with which Trump raised the idea of removing Powell, his advisers repeatedly cautioned him against it. The consensus among legal experts and White House attorneys was that the President did not have clear authority to dismiss the Fed Chair without cause before the end of his term.
Key legal considerations:
– Federal Reserve Chair serves a four-year term but can serve as a Board of Governors member for 14 years
– The Federal Reserve is designed to operate with a degree of independence from the Executive Branch
– Removing a Fed Chair could trigger a legal and constitutional crisis, undermining market confidence in the central bank
Historical Context
The idea of firing a Federal Reserve chair is not only controversial but nearly unprecedented in modern U.S. political history. The independence of the Federal Reserve has long been protected under both tradition and legislative frameworks to shield monetary policy from political interference.
Historically,
– Presidents often disagree with Fed policy but stop short of taking action to remove Fed leaders
– Richard Nixon pressured Fed Chair Arthur Burns in the early 1970s, but did not formally seek his removal
– Trump’s repetitive public and private
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