Although Trump cannot dismiss Powell, he can fire everyone else at the Fed

Everyone knows President Donald Trump can't dismiss Federal Reserve Jerome Powell. The remainder of the board? Fair game. And he knows. thus do they, thus some are apparently seeking job preservation assistance.

All seven Federal Reserve Board members are nominated by the President and ratified by the Senate. Trump may clean house with numerous Biden appointments in important posts.

On the chopping block?

Talking about Powell first. Trump reappointed him in 2017, and his Chairship runs until 2026. Powell can't be fired without a “for cause” justification from the president-elect. Gross wrongdoing, not policy disputes.

Powell knows. Defiance and unusual power characterize him. Powell said “No.” when asked whether he would quit if Trump requested. He waited a few seconds for everyone to digest his remark.

Trump isn't considering Powell yet. His first target is Michael Barr, the Vice Chair for Supervision. Barr oversees bank regulation and is Biden-supporting. His tenure ends in 2026, but Trump's aides are considering firing him.

However, Trump's board friends are safe. Trump appointed Christopher Waller in 2020 and Michelle Bowman in 2018. Waller focuses on monetary policy, Bowman on community banking. These two won't go until Trump wants them to

The legal gaps Trump may exploit

Now things become complicated. Federal law allows Fed governor removal only for reason. That seems solid, but “cause” is unclear. Misconduct? Sure. Policy disputes? Probably not. Trump, being himself, may challenge this in court.

Princeton economist and former Fed Vice Chair Alan Blinder said. He expects the courts will rule for Powell, but he can't promise it. Blinder: “Trump could try and he might try. No guarantees if it reaches to the Supreme Court.

You may also be demoted. Trump may keep Powell on the board but remove him as chair. Nothing has been done before, therefore it's a murky area, say lawyers.

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