Federal Appeals Court Blocks White House Attempt to Remove Fed Governor Lisa Cook
WASHINGTON – A federal appeals court ruled Tuesday that President Biden‘s administration cannot immediately remove Federal Reserve Governor lisa Cook from her position, preserving a key element of the central bank’s political balance. The decision halts a challenge brought by the White House seeking to oust Cook, a member of the Fed’s Board of Governors, and underscores the legal protections afforded to fed officials.
The case centered on the White House’s argument that Cook’s continued service was causing “irreparable harm” to the government. A successful removal would have allowed President Trump, through a prior appointment and a recent confirmation, to establish a majority of his nominees on the seven-member board, potentially shifting the direction of monetary policy. The court’s ruling maintains the current 3-2 Democratic majority on the board.
The court found that the “for-cause” provision protecting Fed governors was intended to ensure their independence from presidential influence. “The plain purpose of providing for-cause protection was to assure members of the Board of Governors-and national and global markets-that they do not serve at will and thus enjoy a measure of policy independence from the President,” the court wrote.
The Biden administration had sought to remove Cook following the confirmation of White House economist Stephen Miran to a short-term vacancy on the board Monday night. Miran’s confirmation, secured by a narrow Senate vote, further fueled concerns about a potential shift in the Fed’s leadership.
the ruling was authored by Judge Bradley Garcia, appointed by President Biden, and joined by judge Michelle Childs, also a Biden appointee. Judge Gregory Katsas, appointed by President Trump, dissented, arguing he would have allowed the removal to proceed. Cook’s attorneys successfully argued that preventing the President from controlling the independent central bank did not constitute irreparable harm.
The legal battle highlights the ongoing tension between presidential authority and the established independence of the Federal Reserve, a cornerstone of U.S. economic policy. the case will likely have lasting implications for future attempts to influence the composition and direction of the Fed.
