Trump Allies Reportedly Planning to Limit Federal Reserve’s Independence
Summary from the AllSides News Team
Allies of former President Donald Trump are drafting plans to limit the Federal Reserve’s independence from political influence, according to a Wall Street Journal (Center bias) report.
The Details: The plan, outlined in a 10-page document, suggests that Trump would be consulted on interest rate decisions in a potential second term. While Trump campaign officials told the Journal that the plans should not be considered “official,” such a move would not be out of line with other efforts by Trump allies. This includes the Heritage Foundation’s “Project 2025,” which calls for Trump to end rules requiring federal employees be hired on merit instead of political allegiance.
For Context: While Fed board members are nominated by the president and confirmed by the Senate, the Fed operates independently to keep management of the economy separate from partisan politics. Trump nominated the current Fed chair, Jerome Powell, in 2017 but said in February that he would not reappoint him, accusing the Fed of working in President Joe Biden’s political favor. Biden nominated Powell for a second term in 2021, rejecting calls to appoint Lael Brainard, the board’s sole Democrat. Powell, a Republican, has largely been the face of the Fed’s efforts to quell persistent inflation by raising interest rates.
How the Media Covered It: Coverage sometimes echoed partisan attitudes about Trump and the Fed. While a Common Dreams (Left bias) headline said, “Right-Wingers Plot to Give Trump Control,” a Daily Wire (Right bias) headline said Trump’s allies “Want Fed Answerable To Him.” The New Yorker (Left bias) went further, saying Trump’s allies wanted a “Federal Reserve Coup.” MarketWatch (Center bias) highlighted economists who called the plan the “bad idea of all bad ideas,” but also noted some who said the Fed “should do the people’s bidding.”
Featured Coverage of this Story
From the Right
Trump Allies Want Fed Answerable To Him If He’s Elected: ReportSome supporters of former President Donald Trump are pushing for the Federal Reserve Board to be more answerable to the president, hoping that if Trump is elected in November he can influence the Fed’s policies, according to The Wall Street Journal (WSJ).
Some suggestions reportedly include the Fed consulting the president on interest rate changes, making Fed regulations subject to a review from the White House, and having the Fed monitored by the Treasury Department, a part of the executive branch. Although Fed chairman Jerome Powell’s term expires in 2026, the group...
From the Left
Right-Wingers Plot to Give Trump Control Over Federal Reserve If ReelectedRight-wing allies of former U.S. President Donald Trump are reportedly crafting a plan to give the executive branch control over Federal Reserve policy decisions, an effort that comes as the presumptive GOP nominee continues to signal his authoritarian intentions for a potential second term.
The Wall Street Journalreported Thursday that former Trump administration officials and other supporters of the ex-president "have in recent months discussed a range of proposals, from incremental policy changes to a long-shot assertion that the president himself should play a role in setting interest rates."
"A small group of...
From the Center
Trump Allies Draw Up Plans to Blunt Fed’s IndependenceDonald Trump’s allies are quietly drafting proposals that would attempt to erode the Federal Reserve’s independence if the former president wins a second term, in the midst of a deepening divide among his advisers over how aggressively to challenge the central bank’s authority.
Former Trump administration officials and other supporters of the presumptive GOP nominee have in recent months discussed a range of proposals, from incremental policy changes to a long-shot assertion that the president himself should play a role in setting interest rates. A small group of the former president’s allies—whose work...
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