It won’t work, but it sure will rattle the economy.
Last night, in a letter posted to social media, President Trump tried to deliver on his threat to fire Federal Reserve governor Lisa Cook on trumped-up charges of mortgage fraud.
Except that Trump doesn’t have the authority to fire a sitting governor with a term appointment, and Cook made clear that she is not going anywhere. The Supreme Court, in Trump v. Wilcox, recently indicated that it considers Fed appointees as sacrosanct, unlike other independent agencies where the Court held that a president can replace even term appointees.
This is of course ludicrous: As Georgetown Law’s Josh Chafetz explains, the Roberts Court’s extreme effort to split the baby by claiming that Federal Reserve appointees hold some special status that independent appointees of the National Labor Relations Board and other agencies don’t is “transparent bullshit designed to simultaneously serve the conservative legal movement’s interest in deregulation via the ‘unitary executive’ and corporate interests in not crashing the economy.”
Trump is barred from firing Lisa Cook not because the Supreme Court said so but because he doesn’t have a cause for firing. The alleged mortgage fraud is not proven in any way. As Adam Levitin explains, FHFA director Bill Pulte’s mere letter of criminal referral is not a judicial order, and people can have more than one “principal” residence. The entire episode makes a mockery of due process, and reveals Pulte as a dangerous regime functionary rooting through the mortgage applications of a preselected enemies list.
Yet we are where we are. And now Chief Justice Roberts will be forced to choose between his constant deference to Trump and the safeguarding of a depoliticized economy.
So what now?
Trump’s ploy is part of his long-standing clumsy scheme to take over America’s central bank. He has repeatedly tried to pressure Fed chair Jay Powell into resigning, because he’s furious with Powell’s refusal to cut interest rates.
