Trump Blocked From Firing Fed Governor Lisa Cook Before Key Interest Rate Decision
A U.S. Court of Appeals for the District of Columbia Circuit has ruled that former President Donald trump cannot fire Federal Reserve Governor Lisa Cook before the central bank’s policy committee meets to consider lowering interest rates. The ruling allows Cook to participate in the two-day meeting beginning Tuesday morning.
The decision stems from Trump’s attempt in late August to fire Cook “for cause,” based on allegations of mortgage fraud brought forth by Bill Pulte,his governance’s housing finance director. Cook later filed a lawsuit to block her firing and has denied any wrongdoing.
Trump’s legal team had requested an emergency pause to a lower-court ruling that prevented Cook’s removal while her lawsuit proceeds. However, the appeals court resolute that the requirements for such a stay pending appeal were “not satisfied.”
The court’s brief order, issued Monday night, effectively upholds the lower court’s decision. U.S. District Judge Jia Cobb had previously ruled that trump’s action likely violated the Constitution’s Due process Clause.Judge Bradley Garcia, in a concurring statement, agreed, stating Cobb was “correct” in her assessment. He further emphasized the “myriad unique features of this case” compared to othre challenges to presidential removals. Judge J. Michelle Childs, also appointed by President Joe Biden, joined Garcia’s concurrence.
Trump appointee Gregory Katsas dissented, arguing that Cook could be removed for conduct predating her Fed appointment and that she did not have a constitutionally protected property interest in her office. he believed the “equitable balance” favored the goverment and would have granted the stay.
This move to fire Cook was considered unprecedented, and reflects Trump’s repeated desire for lower interest rates. He has frequently criticized Federal Reserve Chairman jerome Powell for not lowering rates and previously considered attempting to remove him, though a May Supreme Court ruling offered some protection to Powell. While Trump has as backed off threats against Powell, he pursued the effort to fire Cook, a Biden appointee who has consistently voted with Powell.
The White House has not yet responded to CNBC’s request for comment.
