Stephen Miran’s journey to join the Federal Reserve has been unusual from the start.
He was tapped to fill what could be one of the shortest stints on the Board of Governors after Adriana Kugler abruptly stepped down from the Fed last month. He has moved through the confirmation process at warp speed as Republican lawmakers try to get him seated ahead of the Fed’s vote on interest rates next week. And he has been nominated against the backdrop of an all-out push by President Trump to remake the central bank’s top ranks after months of withering attacks.
But perhaps the biggest break with tradition involves Mr. Miran’s stated plans to remain tied to the White House while he serves at the Fed. Rather than resign his post advising the president on economic policy as chair of the Council of Economic Advisers, Mr. Miran said, he would instead take a unpaid leave of absence. That would enable him to return to the administration once his term at the central bank was complete.
The unusual arrangement has raised the specter that Mr. Miran may feel beholden to Mr. Trump and unwilling to support policy actions that, while good for the economy, would be politically problematic for the president who employs him.
Mr. Miran’s decision has greatly troubled former White House officials, legal experts, economists and Democratic lawmakers, but not Senate Republicans, who are poised to advance his nomination through a committee vote as soon as Wednesday. Many experts have warned that confirming him under these circumstances could set a dangerous precedent undermining the Fed’s longstanding political independence.
“It’s obviously inappropriate and very concerning in terms of his ability to operate independently,” said Glenn Hubbard, who served as chair of the Council of Economic Advisers — the same post held by Mr. Miran — during the George W. Bush administration.
The White House declined repeatedly this week to answer specific questions about Mr. Miran’s planned leave of absence. “Based on legal guidance, if confirmed, Stephen Miran may take an unpaid leave of absence from his C.E.A. position,” Kush Desai, a White House spokesman, said in a statement.
But Mr. Miran offered a few new details about his planned leave in correspondence with Senator Elizabeth Warren, Democrat from Massachusetts, which she released on Tuesday.
If he is confirmed, Mr. Miran’s term with the Fed will last until January, though he could remain in that role until Mr. Trump secured a successor. Asked if he would commit to resigning once the term expired, Mr. Miran said “no,” signaling to the senator that he would not automatically depart.
The comment suggested that Mr. Miran was open to his term’s lasting longer than four months, since it could take time for the president to identify a new governor, or Mr. Miran himself could be considered for other positions within the central bank.
But Mr. Miran did tell Ms. Warren that he could “re-evaluate” his leave of absence from the White House in the event of a longer appointment. While on leave, Mr. Miran said, he would not “maintain access” to his White House email, but would continue to consult with the Council of Economic Advisers “to the extent appropriate for a member of the Fed.” He did not explicitly agree to disclose any conversations he has with the president beyond what may be required by law.
Mr. Trump has made no secret about his desire to see a more compliant central bank that will acquiesce to his demands to lower borrowing costs. The Fed has kept interest rates steady for months in a bid to keep inflation under control. The president has even bragged that he is on the precipice of clinching a majority of support on the powerful board, which Mr. Miran could be the next to join.
Mr. Trump may have yet another opportunity to appoint a board member if he is successful in ousting Lisa Cook, another governor, over allegations of mortgage fraud. And the president will get to appoint a new Fed chair to replace Jerome H. Powell once his term ends in May.
In his advisory role at the White House, which similarly required Senate confirmation, Mr. Miran has echoed some of the president’s attacks on the Fed. He has also helped to produce favorable economic research for Mr. Trump, particularly to make the case that his punishing global tariffs would not cause prices to rise.
Mr. Miran revealed his intentions to stay on at the White House at a confirmation hearing last week, as he sought to head off questions about his ability to resist the president’s pressure. He said he had “received advice from counsel” that he could retain his post at the Council of Economic Advisers on an unpaid basis, citing the fact that the appointment to the Fed may span only about four months.
By taking a leave of absence, Mr. Miran would essentially preserve his ties to that position, while taking on a critical central banking role affording him a powerful vote over the nation’s economic trajectory. If confirmed, he would be able to influence the debate over interest rates, weigh in on the rules and regulations imposed on Wall Street and set priorities for the staff.
Many congressional Democrats reacted coolly to Mr. Miran’s plans, pointing to the fact that he personally had endorsed the idea of closing the “revolving door” between the Fed and the executive branch.
“You’re going to be an employee of the president of the United States on leave,” warned Senator Jack Reed, Democrat from Rhode Island, during last week’s hearing. He added that Mr. Trump could just call up Mr. Miran and say, “Here, I want you to do this, this and this.”
Some experts also questioned the legality of Mr. Miran’s arrangement, given the strict ethics requirements imposed on Fed governors — who, among other restrictions, must devote their “entire time” to the board and its business.
“It ought to be disqualifying,” said Kathryn Judge, a top law professor at Columbia University who studies financial markets and regulation.
Ms. Judge said the Fed’s founding law does not address “directly” whether someone like Mr. Miran could essentially preserve his position at the White House while serving on the central bank. But she said Congress did not intend that arrangement when it chartered the system and imposed numerous guardrails in 1935.
“Given the thoughtfulness of those design features, it seems clear Congress expected meaningful independence,” Ms. Judge added, warning later that any attempt to compromise the institution could pose “incredible dangers” to the economy.
Lisa Gilbert, a co-president of Public Citizen, a watchdog group, said Mr. Miran’s continued relationship with the White House would be “completely inconsistent” with that vision. She said that was especially true at a moment when Mr. Trump had sought to browbeat the Fed into lowering interest rates.
“The Trump administration has consistently tried to apply pressure to the Fed,” Ms. Gilbert said, adding that “this kind of dual role seems inherently problematic when we already understand the pressure they’re attempting to bring to bear on this independent entity.”
Colby Smith covers the Federal Reserve and the U.S. economy for The Times.
Tony Romm is a reporter covering economic policy and the Trump administration for The Times, based in Washington.
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