BY MIRABEL ODETA
U.S. Treasury Secretary Scott Bessent warned on Tuesday that it would be a serious mistake for Federal Reserve Chair Jerome Powell to attend Supreme Court arguments in a high-profile case concerning President Donald Trump’s attempt to remove a central bank governor. The case has drawn widespread attention as it tests the limits of presidential authority over the Federal Reserve and raises questions about the independence of the U.S. central bank.
The Supreme Court is scheduled to hear arguments on Wednesday regarding the legality of Trump’s effort to dismiss Fed Governor Lisa Cook. While the courts have allowed Cook to continue serving on the Fed during the legal proceedings, her potential removal has become a flashpoint in the ongoing debate over political influence on the nation’s monetary policy.
According to multiple media reports on Monday, Powell had planned to attend the court’s oral arguments. Such a move has been interpreted by some observers as a highly symbolic display of the tense relationship between the Fed and the Trump administration, particularly following threats from the U.S. Department of Justice to pursue a criminal investigation of Powell. The Fed chair has described the investigation as a “pretext” aimed at pressuring him regarding monetary policy decisions, fueling concerns about political interference in central bank operations.
The controversy surrounding Cook stems from alleged misstatements on mortgage documents she received prior to her appointment at the Fed. Critics have dismissed the administration’s effort to remove her as a pretext for broader policy goals, including attempts to lower interest rates or to create additional vacancies on the Fed’s Board of Governors that Trump could fill with his own nominees.
“I actually think that’s a mistake,” Bessent said in an interview with CNBC, referring to Powell’s reported plan to attend the hearing. “If you are trying not to politicize the Fed, for the Fed chair to be sitting there, trying to put his thumb on the scale, is a real mistake.” His comments underline the concern that even the appearance of involvement by the Fed chair could be interpreted as compromising the central bank’s independence.
Observers have highlighted the critical role of Fed independence in maintaining economic stability. To shield governors from political influence, members of the Federal Reserve Board serve 14 year terms and can be removed only “for cause.” While this standard has never been tested in court, it is generally understood to prohibit removal based on disagreements over monetary policy decisions. To date, Cook has not faced any civil or criminal charges related to the mortgages in question.
The dispute over Cook’s position comes at a pivotal moment as Trump approaches the selection of a nominee to succeed Powell when his term as the Fed’s chair ends in May. The timing of the nomination, coupled with ongoing legal battles, has intensified scrutiny of the administration’s actions and rhetoric regarding the central bank. Bessent told CNBC that a decision on Powell’s successor could be announced as early as next week, highlighting the high stakes involved for the Fed’s future leadership.
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