President Donald Trump reportedly drafted a letter firing Federal Reserve Chairman Jerome Powell and showed it to House Republicans during an Oval Office meeting the evening of Tuesday, July 15. According to The New York Times, the president then asked the lawmakers whether they thought he should do it.
On Wednesday afternoon Trump was asked about reports that Powell’s termination may be imminent and he denied it.
“I don’t rule out anything but I think it’s highly unlikely,” Trump told reporters in the Oval Office.
“I talked about the concept of firing them. I said ‘What do you think?’ Almost every one of them said that I should. But I’m more conservative than they are,” Trump said.
Rep. Anna Paulina Luna, R-Fla., was at the White House meeting with the president and posted on X, “Hearing Jerome Powell is getting fired! From a very serious source.”
She believes the president should fire Powell.
“100%. I think that the President has the actual authority to be able to do it,” Luna said.
Can a president fire the chairman of the Federal Reserve?
The Federal Reserve is independent. The chairman is appointed by the president and confirmed by the Senate for a four year term. The chairman and the board are legally mandated to implement fiscal policy that will lead to maximum employment and stable prices.
In 2019, Rep. Maxine Waters, D-Calif., asked Powell, “If you got a call from the president today or tomorrow, and he said, ‘I am firing you, pack up, it’s time to go.’ What would you do?’’
“Of course, I would not do that,’’ Powell answered.
The president has continuously voiced frustration with Powell for not lowering interest rates. On Tuesday, the president said the Fed should lower the rate by three points, which would take it from 4.5% to 1.5%.
“He’s got a very easy job to do. You know what he has to do? Lower interest rates,” Trump said Wednesday.
For now though, Trump said he isn’t going to attempt to remove Powell.
“Unless he has to leave for fraud. I mean it’s possible there’s fraud involved in the $2.5, $2.7 billion renovation,” Trump added.
The president is referring to the ongoing renovation of the Federal Reserve Headquarters.
The project was approved in 2017 for $1.9 billion. The costs have since ballooned to more than $2.5 billion. The Federal Reserve said the extra costs were incurred due to increased materials costs, and unforeseen conditions including higher than anticipated asbestos levels, toxic soil contamination and a high water table.
Powell ordered an inspector general investigation into the cost overruns.
