The Federal Reserve has clapped back at President Donald Trump after he moved to fire an independent governor based on an unproven allegation made by a MAGA acolyte.
As the president doubled down on his bid to unseat Governor Lisa Cook – which would allow him to install his own board member and seize majority control of the Central Bank – the Fed issued a rare, pointed statement pushing back against the power grab.
“Congress, through the Federal Reserve Act, directs that governors serve in long, fixed terms and may be removed by the president only ‘for cause’,” a Federal Reserve spokesperson said, citing the need to have a valid, justifiable reason for termination.
“Long tenures and removal protections for governors serve as a vital safeguard, ensuring that monetary policy decisions are based on data, economic analysis, and the long-term interests of the American people. The Federal Reserve will continue to carry out its duties as established by law.”
The comments came after Trump took the unprecedented step this week of writing a termination letter to Cook, which he posted on social media, telling her she would be removed from her position “effective immediately” over allegations of mortgage fraud.
The allegation was made by MAGA ally Bill Pulte, the head of the federal Housing Finance Agency, who has separately also referred New York’s Democrat Attorney General Letitia James and California Democrat Senator Adam Schiff to the department on similar mortgage fraud allegations.
Targeting Cook is a dramatic escalation in Trump’s longstanding feud with the Federal Reserve and its chairman Jerome Powell, who the administration has repeatedly attacked for not reducing interest rates.
While the president has opted not to sack Powell before his term expires next year, he has made no secret of his desire to stack the board with more people who are aligned with his views.
Removing Cook, who was appointed under Joe Biden to serve until 2038 and is the first Black woman to serve as a Fed governor, would help him fulfill this goal.
“We’ll have a majority very shortly and that’ll be great,” he said on Tuesday, referencing his desire to control the direction of the independent bank’s monetary policy.
Speaking to reporters at the White House on Wednesday morning, Kevin Hasset, the Director of the National Economic Council, said Cook should go on leave until the accusations are resolved.
“The fact that she is not doing that suggests that she is partisan and is trying to make a partisan stance which is contrary to the independence of the Fed,” he said.
Treasury Secretary Scott Bessent also weighed in on Fox News, saying there were “two kinds of people” – those who think Trump was putting undue pressure on the Fed, and those “who think that if a Fed official committed mortgage fraud, this should be examined and they shouldn’t be serving as one of the nation’s leading financial investigators.”
“What we haven’t heard from Ms. Cook is we haven’t heard her say ‘I didn’t do it.’ She just keeps saying the president can’t remove her’,” said Bessent.
Cook, however, says she is going nowhere.
“President Trump purported to fire me “for cause” when no cause exists under the law, and he has no authority to do so,” she said.
“I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022.”
The post Fed Slaps Back at Trump and Says Keep Your Hands Off Cook appeared first on The Daily Beast.
