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Newsweek
22-07-2025
- Business
- Newsweek
Should Donald Trump Fire Jerome Powell? Wilbur Ross Weighs In
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Former Commerce Secretary Wilbur Ross believes that President Donald Trump attempting to unseat Federal Reserve Chair Jerome Powell would result in a lengthy legal battle and few benefits for the president. In an interview with Newsweek last week, Ross said he does not think Trump intends to fire Powell. Asked whether Trump should, Ross responded: "I don't think it's a question of should." "Powell's term expires mid-year next year. So he's not going to be in for very long in any event," he said. "And if Trump went to fire him, no doubt it would end up in court, and to get a decision like that, which undoubtedly would end up in the Supreme Court, to try to bring that to a decision in less than a year is very unlikely." "So I'm not so sure that even if he wanted to do it. And even if he were able to ultimately convince the court that he has the power to do it, I'm not sure he'd save very much time." Why It Matters Talk of Powell's resignation, or the president firing him before his term ends in May 2026, stems from a dispute over the Federal Reserve's reluctance to cut interest rates from the current target range of 4.25–4.50 percent. Since the beginning of his second term, Trump and certain members of his cabinet have called for sizable rate cuts to stimulate economic growth and reduce the interest the United States pays on its debt. However, the central bank has repeatedly stated that it will remain in "wait-and-see" mode until there is greater clarity on the trajectory of inflation and until the full impact of Trump's tariffs on the U.S. economy is understood. Firing Powell from his Senate-confirmed post would mark a significant departure from the Fed's historically recognized independence, and it would likely raise questions about the stability of the U.S. economy. L: Former Commerce Secretary Wilbur Ross speaks at the Concordia Annual Summit on September 23, 2024. R: Federal Reserve Chair Jerome Powell at a news conference in Washington, D.C., on May 7, 2025. L: Former Commerce Secretary Wilbur Ross speaks at the Concordia Annual Summit on September 23, 2024. R: Federal Reserve Chair Jerome Powell at a news conference in Washington, D.C., on May 7, 2025. John Lamparski /for Concordia Summit / Getty Images What To Know Trump has taken to calling Powell, who chairs both the Fed's Board of Governors and its Open Market Committee, "too late Powell" over his decision to hold rates steady at successive monetary policy meetings, while also dubbing him a "stupid person" and "Trump Hater." However, the president's messaging on whether he intends to oust Powell has been mixed. Speaking to reporters in the Oval Office last week, Trump said that lowering interest rates by three percentage points would save the government $1 trillion in debt payments, and that he had spoken with Republican members of Congress about the possibility of firing the Fed chair. "Almost every one of them said I should, but I'm more conservative than they are," Trump said. "I don't rule out anything," he added, "but I think it's highly unlikely." According to Section 10 of the Federal Reserve Act, the president can remove any member of the Fed's Board of Governors "for cause," which is widely interpreted to mean serious misconduct or malfeasance in office. However, past Supreme Court cases have determined that this cannot be done for simple policy disagreements, i.e., over whether and when to adjust interest rates. Last week, Trump suggested that Powell could be forced to resign "for fraud," pointing to the recent $2.5 billion renovation of the Fed's Washington, D.C. headquarters. In a recent letter to Powell, Russ Vought, director of the Office of Management and Budget (OMB), called the renovations an "ostentatious overhaul," and said that statements made by Powell during his testimony before the Senate Banking Committee in June raised "serious questions" about the project's compliance with the federal guidelines. In his response, Powell said: "We have taken great care to ensure the project is carefully overseen since it was first approved by the Board in 2017." As well as the oversight it has already been subject to, Powell said he had asked the Federal Reserve's independent Inspector General "to conduct a fresh review of the project." Even if the allegations of fraud were substantiated and the Trump administration made formal attempts to remove him from his post, Powell would be able to contest this decision. As Ross told Newsweek, Powell's tenure could end before the case was fully resolved in the form of a Supreme Court ruling. However, in the case of a preliminary injunction, Vice Chair Philip Jefferson would assume Powell's duties during the dispute. During a press conference shortly following the presidential election, Powell said that it was "not permitted under law" for the president to demote or fire governors or those holding leadership positions within the Fed. When asked whether, if asked by Trump, he would resign from his post, Powell responded bluntly: "No." What People Are Saying President Donald Trump, speaking to reporters about Powell last week: "Fortunately, we get to make a change in the next, what, eight months or so, and we'll pick somebody that's good and we'll pick somebody. I just want a fair job. We want to see lower interest rates. Our country deserves it. We're making a lot of money. We're doing great as a country." Commerce Secretary Scott Bessent told Fox Business this week: "I know Chair Powell. There's nothing that tells me that he should step down right now. He's been a good public servant. His term ends in May. If he wants to see that through, I think he should. If he wants to leave early, I think he should." Federal Reserve Chair Jerome Powell, at a European Central Bank forum in Portugal on July: "I'm very focused on just doing my job. I mean, there are things that matter—using our tools to achieve the goals that Congress has given us: maximum employment, price stability, financial stability. And that's what we focus on 100 percent." What Happens Next In an interview with Bloomberg Television this week, Bessent said a "formal process" for identifying Powell's successor had begun. "It's President Trump's decision, and it will move at his speed," he added. Economists who previously spoke to Newsweek said they anticipate the Fed cutting rates by the end of the year at the latest. These cuts, they said, could range from one 25-basis-point cut to several of this size.
Mint
19-07-2025
- Business
- Mint
Trump is poised to grab control of the Fed next year
President Donald Trump wants the Federal Reserve to slash interest rates by three percentage points, a massive cut that could push borrowing costs back to pandemic lows. With two seats at the Fed likely opening up soon, he may finally get the chance to reshape the central bank and force the aggressive easing he is demanding. Governor Adriana Kugler's term expires in January 2026 and Jerome Powell's term as chair ends in May 2026. If Trump replaces both and Powell steps down from the board entirely (a typical move for departing chairs), the president will be responsible for appointing four of the seven governors. That is a working majority alongside a chair who may share his appetite for deep rate cuts. In theory, this could tilt the Federal Open Market Committee toward the kind of easing Trump wants. In practice, it isn't that simple. The Fed has held its benchmark rate steady at 4.25% to 4.50% despite cooling inflation and softening job growth. Powell says the committee needs more time to assess how tariffs and fiscal policy will ripple through the economy. He has made clear that July's inflation report–released after the Fed's next meeting–will be crucial. That makes a July cut unlikely. Some of Trump's Fed appointees are already laying the groundwork for easier policy. Governor Christopher Waller argues the labor market is weaker than headline numbers suggest and inflation risks are fading. He has hinted he may dissent at this month's meeting if the committee doesn't cut rates. Vice chair for supervision Michelle Bowman, also a Trump pick, has turned more dovish recently. The timing of these shifts matter, says Will Denyer at Gavekal Research. Waller has emerged as a front-runner to replace Powell next year. Unlike other potential nominees, he is already a sitting governor, Senate-confirmed and widely respected within the Fed system. But Trump's three-point cut isn't just unlikely, it's out of step with current economic conditions. The economy is still growing at a moderate pace, inflation remains above the Fed's 2% target and tariff uncertainty clouds the outlook. That hasn't stopped the president from pushing. He argues ultralow rates would slash the cost of servicing national debt, posting on social media: 'Very Low Inflation. One Trillion Dollars a year would be saved!!!" He's also continued ad hominem attacks on Powell. Market expectations are far more modest. Futures pricing suggests investors expect two quarter percentage point cuts by year-end, matching the Fed's own forecasts. Citi economists see a September move as increasingly likely, especially if job market data weakens further. But that is a long way from Trump's three-percentage-point target. Economists warn that such dramatic easing would require a seismic shift in expectations. Nobel Prize-winning economist Paul Krugman has compared Trump's approach to monetary policy to President Erdogan's in Turkey, where politically driven easing led to runaway inflation and emergency hikes. Whether Trump succeeds in reshaping the Fed depends on who he nominates and how far they're willing to go. The window is opening. But for now, Powell is still chair and the center of the committee still favors caution. That could change in 2026. Write to Nicole Goodkind at
Axios
16-07-2025
- Business
- Axios
Exclusive: Longtime critic Sen. Warren defends Fed in White House attacks
Sen. Elizabeth Warren (D-Mass.) will defend the Federal Reserve in a speech on Wednesday, an unlikely ally for the Fed as it faces unprecedented attacks from the Trump administration. Why it matters: Even one of Fed chair Jerome Powell's toughest, most consistent critics won't back the White House argument. The rare support from the influential lawmaker, who is the top Democrat on the Senate Banking Committee, shows how the party will hit back at White House pressure to oust Powell. What they're saying:"When [Trump's] initial attempts to bully Powell failed, Trump and Republicans in Congress suddenly decided to look into how much the Fed is spending on building renovations," Warren will tell a group of financial policymakers and economists at the Exchequer Club of Washington, D.C. In the remarks — first seen by Axios — Warren acknowledges the topsy-turvy world in which she defends the institution that she has slammed for years. "Independence does not mean impunity and I have long pushed for more transparency and accountability at the Fed. But give me a break," Warren will say in a speech that slams Trump economic policy. "[N]obody is fooled by this pretext to fire Chair Powell. And markets will tank if he does." The big picture: The new attack line among top Trump administration officials and some Republican lawmakers — renovations of the Fed's offices are too costly and over-the-top. President Trump on Tuesday said that the renovations issue could be grounds to fire Powell, a legally dubious move. Flashback: Just a few weeks ago, Warren co-sponsored legislation with Florida Republican Sen. Rick Scott that would force the Fed's watchdog to be Senate-confirmed — a move aimed at stepping up oversight of the central bank. Warren has called Powell a "dangerous man" in her criticism of the Fed's bank regulation policies. She is among the few lawmakers who voted against his confirmation in 2017; she did so again when former President Biden renominated Powell in 2021.
The Herald Scotland
16-07-2025
- Politics
- The Herald Scotland
Michael Waltz to face 'Signalgate' grilling in hearing for top UN post
"You could make a good argument that it's a promotion," Vice President JD Vance said. The Senate-confirmed position is higher profile. And it comes with a cushy New York apartment. But unlike eight years ago, when future presidential candidate Nikki Haley held the job, Trump has decided against making it a top role. That could help Waltz, who's expected to get a grilling from Democrats on the Senate Foreign Relations Committee, at his nomination hearing on July 15. The lower designation will allow Waltz to testify alongside two other Trump nominees. Waltz's testimony will still be the focal point of the hearing. The former Trump aide was one of the president's more hawkish advisers. He is almost certain to face difficult questions about the president's approach to foes such as Russia and Iran -- not to mention Trump's criticisms of United Nations leadership and his withdrawal from the institution's human rights council. "This will be a chance for senators to question the former national security advisor and nominee to be U.N. ambassador, which has historically been a significant foreign policy post," Sen. Chris Coons, a Democrat who sits on the committee, told USA TODAY last week. He said that likely topics will be Ukraine, the conflict in the Middle East and ongoing tension between the U.S. and its allies over Trump's stinging tariffs. Still, the toughest questions Waltz could face are over the text messages in which senior officials discussed strikes on Houthi militants in Yemen before they'd happened. Waltz inadvertently invited a journalist to the chat in an encrypted text messaging app. "He will be asked several times by several senators about his misuse of Signal," Coons said, referring to the commercially available encrypted messaging app. Defense Secretary Pete Hegseth, Vance and other Cabinet officials weighed in on strikes while in the unsecure chain. Waltz took "full responsibility" for the blunder, after it came to light. Trump initially declined to fire him or anyone else over the incident. He fired scores of staff members later in a National Security Council shakeup. House Foreign Affairs Committee Chairman Brian Mast, an ally of Waltz' who served with him in the House, acknowledged that Democrats were likely to zero in on the Signal scandal. "Yet what are they bringing up? An entirely successful military operation, that was precise, that no Americans or American infrastructure or interests were harmed in any kind of way? In the end, that's what he has to answer for," Mast said in an interview. U. N. role remained vacant for months Trump said on May 1 that he would nominate Waltz as his United Nations ambassador, hours after news outlets reported on his ouster. Yet, he did not officially do so for more than a month, raising questions about whether Waltz still had Trump's backing for the job. The president yanked his first pick, Congresswoman Elise Stefanik, in late March amid concerns about the GOP's narrow House majority. Trump eventually signed the necessary paperwork for Waltz in mid-June after USA TODAY asked the White House why Trump had not formally put him forward. Career diplomat Dorothy Shea has represented the United States at the United Nations for the past six months. More: Trump shakes up national security team: Waltz tapped for UN post Trump demotes ambassador role United Nations ambassadors have often served in presidential Cabinets. Trump's first United Nations ambassador, Nikki Haley, had an official seat at the table. But the Republican president downgraded the position after the former South Carolina governor left the job. A White House official who was not authorized to go on the record confirmed to USA TODAY that the U.S. ambassador to the U.N. role would not be part of the Cabinet. That means that Waltz will report to Secretary of State Marco Rubio, who's been acting as Trump's national security adviser since the switch occurred on May 1. Mast said the role is still a "tremendous stepping stool" for Waltz, a former Green Beret and Florida congressman who served on the House Foreign Affairs, Armed Services and Intelligence committees. "It's also a Senate-confirmed position, which puts him under a different level of scrutiny," Mast said. "It's a very different role than what he was doing previously." Waltz will need a simple majority of senators to vote in his favor in the chamber where the GOP holds the majority in order to be confirmed. Sen. Bill Haggerty, a Tennessee Republican who served as U.S. ambassador to Japan, said he expected Waltz to have a successful hearing. He'll have "a big challenge dealing with the United Nations," Haggerty said. He told USA TODAY: "Mike's a competent professional."
USA Today
15-07-2025
- Politics
- USA Today
Former Trump adviser Mike Waltz faces 'Signalgate' grilling in Senate hearing for UN post
WASHINGTON – President Donald Trump cast his dismissal of Michael Waltz as a step up when he reassigned the Republican at the center of the "Signalgate" to a plumb ambassador position. Waltz would leave the National Security Council, he said, to become his nominee for United States ambassador to the United Nations. 'You could make a good argument that it's a promotion," Vice President JD Vance said. The Senate-confirmed position is higher profile. And it comes with a cushy New York apartment. But unlike eight years ago, when future presidential candidate Nikki Haley held the job, Trump has decided against making it a top role. That could help Waltz, who's expected to get a grilling from Democrats on the Senate Foreign Relations Committee, at his nomination hearing on July 15. The lower designation will allow Waltz to testify alongside two other Trump nominees. Waltz's testimony will still be the focal point of the hearing. The former Trump aide was one of the president's more hawkish advisers. He is almost certain to face difficult questions about the president's approach to foes such as Russia and Iran — not to mention Trump's criticisms of United Nations leadership and his withdrawal from the institution's human rights council. "This will be a chance for senators to question the former national security advisor and nominee to be U.N. ambassador, which has historically been a significant foreign policy post," Sen. Chris Coons, a Democrat who sits on the committee, told USA TODAY last week. He said that likely topics will be Ukraine, the conflict in the Middle East and ongoing tension between the U.S. and its allies over Trump's stinging tariffs. Still, the toughest questions Waltz could face are over the text messages in which senior officials discussed strikes on Houthi militants in Yemen before they'd happened. Waltz inadvertently invited a journalist to the chat in an encrypted text messaging app. "He will be asked several times by several senators about his misuse of Signal," Coons said, referring to the commercially available encrypted messaging app. Defense Secretary Pete Hegseth, Vance and other Cabinet officials weighed in on strikes while in the unsecure chain. Waltz took 'full responsibility' for the blunder, after it came to light. Trump initially declined to fire him or anyone else over the incident. He fired scores of staff members later in a National Security Council shakeup. House Foreign Affairs Committee Chairman Brian Mast, an ally of Waltz' who served with him in the House, acknowledged that Democrats were likely to zero in on the Signal scandal. "Yet what are they bringing up? An entirely successful military operation, that was precise, that no Americans or American infrastructure or interests were harmed in any kind of way? In the end, that's what he has to answer for," Mast said in an interview. U. N. role remained vacant for months Trump said on May 1 that he would nominate Waltz as his United Nations ambassador, hours after news outlets reported on his ouster. Yet, he did not officially do so for more than a month, raising questions about whether Waltz still had Trump's backing for the job. The president yanked his first pick, Congresswoman Elise Stefanik, in late March amid concerns about the GOP's narrow House majority. Trump eventually signed the necessary paperwork for Waltz in mid-June after USA TODAY asked the White House why Trump had not formally put him forward. Career diplomat Dorothy Shea has represented the United States at the United Nations for the past six months. More: Trump shakes up national security team: Waltz tapped for UN post Trump demotes ambassador role United Nations ambassadors have often served in presidential Cabinets. Trump's first United Nations ambassador, Nikki Haley, had an official seat at the table. But the Republican president downgraded the position after the former South Carolina governor left the job. A White House official who was not authorized to go on the record confirmed to USA TODAY that the U.S. ambassador to the U.N. role would not be part of the Cabinet. That means that Waltz will report to Secretary of State Marco Rubio, who's been acting as Trump's national security adviser since the switch occurred on May 1. Mast said the role is still a "tremendous stepping stool" for Waltz, a former Green Beret and Florida congressman who served on the House Foreign Affairs, Armed Services and Intelligence committees. "It's also a Senate-confirmed position, which puts him under a different level of scrutiny," Mast said. "It's a very different role than what he was doing previously." Waltz will need a simple majority of senators to vote in his favor in the chamber where the GOP holds the majority in order to be confirmed. Sen. Bill Haggerty, a Tennessee Republican who served as U.S. ambassador to Japan, said he expected Waltz to have a successful hearing. He'll have "a big challenge dealing with the United Nations," Haggerty said. He told USA TODAY: "Mike's a competent professional."
