The White House reportedly explored the legality of stripping Jerome Powell of his chairmanship of the Federal Reserve Board earlier this year after President Trump discussed firing him.
The White House Office of Legal Counsel considered how to remove Powell from the chairmanship but preserve his membership on the Federal Reserve Board of Governors, sources told Bloomberg.
Larry Kudlow, Trump’s most senior economic adviser, said the White House had no plan to strip Powell of his chairmanship.
“We are not taking any action to change his status,” he told reporters at the White House, but he declined to comment on the reporting that the administration examined the legality of removing Powell from the position earlier this year. He added, “The allegation is six months old or longer than that, so I’m just going to let that go away.”
Over the past several months Trump made repeated public complaints about Powell, whom he nominated to lead the Fed.
Trump told reporters in October he thought the Fed had “gone crazy” after repeated interest rate hikes. Despite comments attacking the Fed, Trump said he would not fire Powell.
Then, as the stock market declined near the end of the year, Trump went after the Fed again, tweeting: “The only problem our economy has is the Fed. They don’t have a feel for the Market, they don’t understand necessary Trade Wars or Strong Dollars or even Democrat Shutdowns over Borders. The Fed is like a powerful golfer who can’t score because he has no touch – he can’t putt!”
Around the same time it was reported that Trump had private discussions about firing Powell.
Powell said in March that Trump had no legal authority to fire him.
“The law is clear that I have a four-year term, and I fully intend to serve it,” Powell said during an interview on CBS’s “60 Minutes.” When pressed for a yes or no, Powell said “no” he did not think Trump could fire him.
