President Trump’s top economic adviser told reporters Friday that the White House is looking for ways to fire Federal Reserve Chairman Jerome Powell despite the legal guardrail he is in his position.
Kevin Hassett, chairman of the White House National Economic Council, has retreated from previous concerns about Powell’s firing, saying the White House is looking for a way to replace the Fed’s chief.
“The president and his team will continue their studies,” Hassett told White House reporters when Powell was fired.
Hassett served as chairman of the White House Economic Advisors Council during Trump’s first term, during which the president frequently criticized and threatened Powell.
Trump’s anger over Powell reigned this week after months of increasingly critical of the Fed chief.
In a social media post Thursday morning, Trump said he blasted Powell for refusing to cut interest rates and couldn’t wait for the Fed chairman to be “dismissed.” His criticism was a dynamic thing known as “stagflation,” the day after Powell warned that Trump’s tariffs could cause economic growth.
The president escalated his attack Thursday afternoon, claiming that if he attempted to fire him, Powell would leave.
The 90-year-old Supreme Court precedent is likely to protect Powell from being fired by the president for anything other than fraud or strict neglect of duties. And Powell repeatedly argued that he would not be able to be legally fired and would refuse to leave until the end of his term.
During Trump’s first term, Hassett declared Powell “100% safe” even if President Powell refused to cut interest rates, infuriated the Fed chief, a lifelong Republican whom Trump himself appointed to the job.
In his 2021 memoir, Hassett told the president that he and other Trump advisers had warned the president that it is actually impossible to fire Powell and that it is likely that financial markets will crash regardless of their legality.
When pressed for that opinion Friday, Hassett said at the time “the market was in a completely different place,” and his comments were limited to the first Trump White House legal analysis.
Hassett also accused Powell of shootings by federal government and bank leaders of adjusting interest rate increases as soon as Trump took office.
“I want to think about policy, not personality, and this Federal Reserve policy was to raise the fees the last time President Trump took office,” Hassett said.
The Fed hiked interest rates in December 2016 under former Fed Chairman Janet Yellen, a month before Trump took office, a year after the recent rate hike. At the time, Powell was a member of the Fed’s board of directors.
The Fed hiked three more times under Yellen. Powell was confirmed as the Fed chair in February 2018, and he made his main side of hikes at four rates, three of which were reversed the following year.
Hassett also argued that Powell had expressed inconsistent vigilance about federal spending and debt under Trump and former President Biden.
“To have everyone refused to warn about going out of control, saying, ‘Oh, this is going to be an inflation catastrophe due to tariffs’, meaning people need to improve their models and improve their messaging,” Hassett said.
But Powell warns below Both cards And Biden said the US is on a “unsustainable” fiscal road and needs to pay back its debts.
