Can the president remove a Fed governor?
Marketplace
Marketplace
4.6 • 8.5K Ratings
🗓️ 26 August 2025
⏱️ 26 minutes
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Summary
Late Monday, President Trump announced plans to remove Lisa Cook from the Federal Reserve Board of Governors over unproven allegations of mortgage fraud. The move is part of his months-long effort to reshape the central bank and pressure it to lower interest rates. But meddling with the Fed's independence could backfire. On today's show, we look at the implications of political interference at the Fed, from the bond market to the U.S. and global economies. Plus, how FEMA's elimination of hazard mitigation programs will affect the country.
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Transcript
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| 0:00.0 | The question hanging over the economy, and not for the first time, is, can the president do that? |
| 0:09.5 | From American public media, this is Marketplace. |
| 0:18.4 | In Denver, I'm Amy Scott in for Kai Rizdal. |
| 0:24.4 | It is Tuesday, August 26th. |
| 0:26.6 | Good to have you with us. |
| 0:28.0 | We're going to start today with the unfolding story of President Trump's attempts to fire |
| 0:32.4 | Federal Reserve Governor Lisa Cook. |
| 0:35.2 | In a letter late yesterday, Trump said he would remove Cook ostensibly over |
| 0:39.6 | unproven allegations of mortgage fraud. The bigger context, of course, is that the president |
| 0:45.6 | has been trying to influence the Fed's makeup for months in order to push the central bank to lower |
| 0:51.9 | interest rates. Governor Cook is planning to file a lawsuit |
| 0:55.9 | to prevent what her lawyer calls an illegal action by the president. But if Trump is successful |
| 1:01.7 | in removing Cook, it might actually achieve the opposite of what he wants. Marketplace's |
| 1:08.0 | Sabree Beneshire explains. If, and it is a big if, the president's attempted firing goes through, it could open the door to more presidential influence at the Fed. |
| 1:19.6 | In the longer term, the issue is whether the Fed is able to act independent of executive influence. |
| 1:27.9 | Matthew Paniotti is a senior analyst at Capital Advisors Group. |
| 1:31.3 | Because if they can't, that has very significant macroeconomic implications in my view. |
| 1:36.3 | If people believe the Fed is influenced by a president more than by inflation data, the less |
| 1:43.1 | faith they have that inflation will be managed well. |
| 1:47.5 | That sends a signal to the bond market that there's more risk of inflation going forward. |
| 1:54.0 | Kathy Jones is with the Charles Schwab Center for Financial Research. |
| 1:57.4 | Inflation is an investment killer. |
... |
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