Every living former Federal Reserve Chair, from Alan Greenspan to Janet Yellen, signed on to an amicus brief urging the Supreme Court not to allow President Donald Trump to remove Federal Reserve Governor Lisa Cook while her case against the president moves through the courts. Allowing Trump to remove Cook as she challenges his attempt to fire her, the former officials said, would amount to a severe compromise of the Fed’s independence and risk the reputational trustworthiness of the central bank.
The former Fed chairs were joined by former Department of Treasury secretaries, former Fed governors, and other federal economists and officials.
In the Thursday friend-of-the-court filing, officials presented a series arguments in favor of central bank independence, pointing to stability of the U.S. dollar and more controls on inflation, borrowing costs, and maximum employment.
“Granting the government’s request to remove Governor Cook from the Board immediately would … expose the Federal Reserve to political influences, thereby eroding public confidence in the Fed’s independence and jeopardizing the credibility and efficacy of U.S. monetary policy,” the 26-page brief states.
If the public loses confidence in the independence of the central bank, its ability to maintain low and stable inflation would be compromised, the former officials said: “Because the stability of long-run inflation expectations is a necessary condition for stable inflation, the Federal Reserve will no longer be able to perform its statutorily mandated objective if its independence is threatened.”
The former officials also called into question any government strategy that compromises central bank independence in favor of “small, short-run gains,” which ultimately result in “substantial long-term harm.”
Later in the brief, they pointed to the recent case of Turkey’s President Tayyip Erdoğan who fired several central bank leaders, ordered a lowering of interest rates, and saw inflation reach 85%. Turkey’s economy had nothing positive to show for it, the brief says.
While Trump’s comments are not explicitly mentioned in the brief, the president has vehemently, publicly urged the Fed to dramatically cut interest rates to lower borrowing costs without consideration of whether such a reduction reflects a data-informed policy decision. Indeed, in several speeches since Trump retook office, Fed Chair Jerome Powell has cited economic data about rising prices and slowing employment in the central bank’s policy decisions. Thursday’s filing warns about the ways similar political pressures on central banks in other countries have weakened economies.
Trump tried to fire Cook in August in a further escalation of his attacks on the Federal Reserve, its governors and its chair. Bill Pulte, Trump’s director of the Federal Housing Finance Agency, posted a criminal complaint on X accusing Cook of committing mortgage fraud, something tax officials in both municipalities where she owns homes have denied. It’s part of a strategy from the Trump White House to disingenuously accuse the president’s political enemies of misrepresenting their primary residences on mortgage documents to obtain more favorable interest rates. Despite mounting evidence to the contrary, the White House has maintained Trump has the right to fire Cook “for cause.”
The bipartisan list of 18 former officials spanned the Reagan administration to the Biden administration, and further included former two-term Fed Chair Ben Bernanke, Jared Bernstein, former Chair of the Council of Economic Advisers under former President Joe Biden, and Robert Rubin, former Treasury Secretary under former President Bill Clinton.
