Trump created a committee to dig into the Fed's Lisa Cook. What is it and what comes next?
Trump’s bid to fire the Fed's Lisa Cook follows a Supreme Court ruling and could affect Jerome Powell, central bank independence and interest rates.
TL;DR
- President Trump has created a committee of inquiry to help him decide on firing Federal Reserve Governor Lisa Cook.
- Cook is accused of mortgage fraud, allegations she denies.
- The committee, consisting of Kevin Hassett, Keith Sonderling, and Andrea R. Lucas, will hear evidence and Cook's defense.
- Cook is scheduled to attend a hearing at the White House on November 5th.
- The committee will recommend to the president whether there is cause to fire Cook.
- This procedure echoes a similar committee formed by President William Howard Taft in 1912.
- The Supreme Court previously blocked Trump's attempt to fire Cook on procedural grounds but allowed him to try again.
- Cook's attorneys have expressed doubts about the legitimacy of the hearing but welcome the opportunity for her to clear her name.
- The committee members are executive branch appointees and not independent of the president.
- The committee does not need to find a crime, only cause for removal, the definition of which may be subject to future litigation.
- Cook's testimony could potentially expose her to criminal jeopardy.
- The committee's recommendation is not final; the president makes the ultimate decision, which could also face judicial review.
- The creation of the committee is unlikely to immediately affect interest rates or the Fed's upcoming votes.
- The situation has no immediate bearing on former Fed Chair Jerome Powell's standing.
- The Fed referred questions about the committee to Cook's attorneys.