Trump Removes Fed Governor Amid Political Control Battle

President Donald Trump has escalated his efforts to control the U.S. Federal Reserve by attempting to remove Governor Lisa Cook, citing allegations of mortgage fraud linked to a criminal referral from the Federal Housing Finance Agency. Cook, appointed by President Biden and the first African American woman to serve as a Fed governor, has denied the allegations and is challenging her removal in court, asserting the dismissal is unprecedented and illegal under the Federal Reserve Act, which allows removal only "for cause." The Federal Reserve has defended its independence, emphasizing the importance of governors' fixed terms for unbiased monetary policy decisions, but stated it will comply with any court ruling on Cook’s status. Trump’s move, if successful, would shift the balance of the seven-member board, giving Trump appointees a majority and potentially enabling the rate cuts he demands, raising concerns about political influence undermining the Fed’s autonomy and inflation control. Former UK Prime Minister Liz Truss has publicly supported Trump’s push for greater political oversight of central banks, arguing for increased accountability to elected officials. Legal experts and commentators are closely watching the court battle, noting that Chief Justice John Roberts may play a key role in determining whether Trump’s firing of Cook is within presidential authority, a decision that could reshape the Fed’s independence for years to come.