Gushiken Yona
In a bold display of defiance, Federal Reserve Chair Jerome Powell has just declared he will not resign, even if President-elect Donald Trump demands it. The move throws a wrench into the already contentious relationship between the two figures.
Powell, addressing reporters on Thursday after the Fed’s decision to cut interest rates, firmly asserted that the president does not have the power to fire or demote him, declaring, “Not permitted under the law.” This declaration underscores the deep tension brewing between the two men.
The friction between Trump and Powell has been simmering for some time. Trump appointed Powell in 2017, but has repeatedly criticized the Fed chair during his first term, arguing that Powell was not easing monetary policy quickly enough.
This disagreement boils down to a fundamental difference in their views on the role of the Fed and its relationship to the executive branch. Trump has repeatedly suggested that the president should have a direct role in setting interest rates. In an interview with Bloomberg News in 2019, Trump said, “I don’t think I should be allowed to order it, but I think I have the right to put in comments as to whether the interest rates should go up or down.”
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However, Powell has steadfastly defended the Fed’s independence, reiterating his commitment to the central bank’s sole responsibility to pursue maximum employment and stable prices, a mission that requires a non-political approach.
In a March 2019 interview with CBS’s 60 Minutes, Powell emphasized this, stating, “My duty is one that Congress has given us, which is to use our tools to achieve maximum employment and stable prices and to supervise and regulate banks so that they treat their customers fairly and so that they’re strong, well capitalized and can perform their critical function in good times and bad. That’s my job.”
He further clarified the Fed’s independence, stating, “We are directed to take, to execute policy, in a strictly non-political way, serving all Americans and that’s what we do. We are independent in that sense. Our decisions on rates can’t be reversed by any other part of government. Our accountability runs through the elected representatives and the oversight committees in Congress.”
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The potential clash between Powell and Trump raises significant questions about the future of monetary policy and the delicate balance between the executive and the independent branches of government. The stakes are high as both sides prepare for a potential standoff, leaving investors and the public to wonder how this dynamic will play out in the months and years to come.
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YONA GUSHIKEN
Yona brings a decade of experience covering gaming, tech, and blockchain news. As one of the few women in crypto journalism, her mission is to demystify complex technical subjects for a wider audience. Her work blends professional insight with engaging narratives, aiming to educate and entertain.
