Posted on 11/28/2018 1:28:02 PM PST by SeekAndFind
In recent weeks, Trump criticized Federal Reserve Chairman Jerome Powell several times. He doesn’t like that Powell is leading the Fed to raise interest rates.
Past presidents avoided such comments so they wouldn’t appear to be interfering. But Trump doesn’t care about appearances.
The Fed is somewhat insulated from electoral politics. The chair and board members have fixed terms. Its composition changes slowly... but it doesn’t have to.
Tucked away deep inside the Fed’s founding law is a provision Trump could use to completely rebuild the Federal Reserve Board of Governors.
Markets should pay attention. I don’t think they are.
A common perception, even among Fed experts, is that presidents can’t fire the chair and board of governors once they take office. They’re thought to be like the Supreme Court in that regard, although they don’t serve for life.
But that’s not quite correct.
The Federal Reserve Act doesn’t explicitly give the U.S. president power to fire the Fed board members. But section 10 has a mysterious little phrase indicating it’s at least possible.
“…thereafter each member shall hold office for a term of fourteen years from the expiration of the term of his predecessor, unless sooner removed for cause by the President.”
That’s all it says on the subject, as far as I can tell. The Act doesn’t define what the word “cause” would entail. But Congress clearly thought the U.S. president should be able to remove board members before their terms expire, under certain conditions.
This legislative time bomb has been lurking in there for decades. Now we have a president who loves exercising unilateral power in ways his predecessors did not.
(Excerpt) Read more at forbes.com ...
Lets just concentrate on fixing the DOJ-FBI-CIA.
A much higher priority.
Yes. He can fire anyone in the executive branch and it’s time to #DRAINTHESWAMP!!!! Fire every hillary voting apparatchik in our corrupt fed govt. All 98% of them...
Could we just get a big CPA firm to audit it? God knows how long it’s even since that was even attempted.
RE: Lets just concentrate on fixing the DOJ-FBI-CIA.
I agree, but this thread is a question about the POWER to fire the fed Chairperson. Can the President do it? Is he given the power to?
RE: Yes. He can fire anyone in the executive branch
Well, that IS the question. Is the Federal Reserve a part of the Executive Branch?
Although an instrument of the US Government, the Federal Reserve System considers itself “an independent central bank because its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government, it does not receive funding appropriated by the Congress, and the terms of the members of the board of governors span multiple presidential and congressional terms.
The same past Presidents that have nothing good to say about Trump?
Many same Presidents have little to no experience in the private sector?
Kavanuagh. Gorpus, Alito and Thomas need to read the legislative record that enacted the federal reserve and try to discern what the legislators thought the term “for cause” meant when they inserted that phrase in the law.
The Fed should be dismantled.
It’s not part of the judiciary or legislative branch ergo it’s part of the executive branch.
RE: Kavanuagh. Gorpus, Alito and Thomas need to read the legislative record that enacted the federal reserve and try to discern what the legislators thought the term “for cause” meant when they inserted that phrase in the law.
What ever it means, it cannot mean because the President DISAGREES with the Fed Chair on Monetary Policy. If the President did and fired the chair simply because he disagrees with his raising interest rates for instance, he might as well BE the Fed chair and make his own policy.
It seems that the “For cause” clause means corruption or personal gain ( e.g., buying or selling bonds knowing what you personally will do in terms of interest rates ).
The FED rolled over on interests rates today...I’m sure Trump is pleased.
Frankly for a guy who did a hit TV series that was all about firing people, I have been disappointed with Trump’s reticence to fire anyone as POTUS.
RE: It’s not part of the judiciary or legislative branch ergo it’s part of the executive branch.
I don’t think that necessarily follows.
The monetary decisions of the Federal Reserve do not have to be ratified by the President (or anyone else in the Executive Branch). The Fed receives no funding from Congress, and the members of the Board of Governors, who are appointed, serve 14-year terms. These terms do not coincide with presidential terms, creating further independence.
However, the Federal Reserve is subject to oversight by Congress, which aims to ensure it achieves the economic objectives of maximum employment and stable prices. And the Fed Chair must submit a semi-annual report on monetary policy to Congress ( NOT the President ).
The primary justification for an independent Federal Reserve is the need to insulate it from short-term political pressures. Without a degree of autonomy, the Fed could be influenced by election-focused politicians into enacting an excessively expansionary monetary policy to lower unemployment in the short-term. This could lead to high inflation and fail to control unemployment over the long-term.
RE: I have been disappointed with Trump’s reticence to fire anyone as POTUS.
He is NOT reticent, but the hit TV series gave him the power to fire at will.
However, he is NOT in a TV series. He is in government and as such, his powers are ( and should be ) LIMITED by LAW.
The Dow went up 617 points today after Chairman Powell’s remarks about interest rates. The market is happy, and Trump should be happy. I am.
Was there a new amendment I missed? Where is the fed reserve listed as a separate branch of gubbermint?
This is not hard.
Agree 1000%.
The Fed hasn’t been independent since it was the Martin Fed, before many of us were even born. William McChesney Martin had no problem telling the DC crowd to ‘stick it’.
Right now, the Fed Chairman unofficially answers to the Treasury. The Treasury answers directly to the President.
The social-engineering leftist nanny state lives off printed money, inflation and massive government debt.
Just kill the Fed, and watch socialism and progressivism die with it.
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