On Wednesday, the Supreme Court gears up to hear arguments in a crucial case over the independence of the Federal Reserve, Trump v. Cook. But it won’t even be the first make-or-break moment the country’s main economic institution has had in the past few weeks.
President Donald Trump’s effort to seize control of the Federal Reserve and its power to set interest rates escalated last Sunday when Fed Chair Jerome Powell announced that he had been served “grand jury subpoenas” and threatened with “criminal indictment” related to cost overruns for the central bank’s building restoration project.
Powell immediately pushed back. The DOJ’s claim that he had lied in congressional testimony about the project was a mere “pretext” that needed to be seen “in the broader context of the administration’s threats and ongoing pressure,” Powell said.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” Powell said.