Trump decides to Replace Fed Chair Jerome Powell
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Trump criticized Jerome Powell for not lowering interest rates and hinted at removing him from office. The Federal Reserve chair’s independence is legally protected, making it difficult for the president to dismiss him without valid cause. If Trump tries to remove Powell, it could lead to a legal battle over the interpretation of the law and the Fed’s autonomy. The Federal Reserve is the central bank of the US. It sets interest rates and makes decisions to maintain the stability of the economy. The Fed is supposed to be independent. This means it should not be controlled by the president or politicians. Jerome Powell is currently the Federal Reserve chair. In his view, the Fed’s independence is protected by law. It means that the president cannot fire him just because he makes other policy choices. Nevertheless, President Donald Trump often disagreed with Powell. Trump said he could fire him if he wanted to. The statute governing the Fed stipulates that a chairman can only be ousted “for cause.” That is to say, there must be some extreme reason, like breaking the law, neglecting his duty, or being untruthful. Disagreement over interest rates is not enough. What the Law Says About Removing the Fed Chair A Supreme Court case, “Humphrey’s Executor,” created this rule during the 1930s. The court said that some officials cannot be fired for political reasons. This case continues to protect individuals like the Fed chair. Congress utilized this idea when they established Fed governors’ lengthy, 14-year terms. Trump was told by White House attorneys that he couldn’t dismiss Powell simply because he didn’t like his policies. But Trump still kept saying that he wanted Powell to go. He even called him “too late” and said that he was “playing politics.” Trump’s trade policies and tariffs created uncertainty…
