Supreme Court Weighs Trump’s Power to Fire Federal Reserve Governors

In a high-stakes showdown that could redefine the independence of the American economy, the Supreme Court heard oral arguments Wednesday on whether President Trump has the constitutional authority to fire Federal Reserve Governor Lisa Cook. The case, Trump v. Cook, represents the first time in the Federal Reserve’s 112-year history that a president has attempted to forcibly remove a sitting governor.

The "For Cause" Conflict

The dispute began in August 2025, when President Trump announced he was firing Cook, citing unproven allegations of mortgage fraud related to a 2021 property purchase—claims Cook and her legal team have vehemently denied as "pretextual."

Under the Federal Reserve Act, governors may only be removed "for cause." The Trump administration’s Solicitor General, D. John Sauer, argued before the justices that the President should have "unreviewable discretion" to determine what constitutes "cause," suggesting that even "gross negligence" or "deceit" in private financial matters is enough to warrant termination without a formal hearing.

Justices Push Back: "Shattering Independence"

While the current conservative-majority Court has previously expanded presidential removal power over other agencies, the justices appeared notably more protective of the Federal Reserve.

Justice Brett Kavanaugh, a Trump appointee, issued a stern warning to the administration’s counsel: "Your position that there’s no judicial review... would weaken, if not shatter, the independence of the Federal Reserve."

Justice Ketanji Brown Jackson questioned the lack of due process, noting that firing a Senate-confirmed official via a social media post without a hearing appeared "fundamentally defective."

Justice Amy Coney Barrett highlighted the economic stakes, asking how the public interest is served if a sudden firing triggers market volatility or even a recession.

The Shadow of Interest Rates

The legal battle is unfolding against a backdrop of intense political friction. Throughout 2025, President Trump has publicly attacked the Fed’s refusal to lower interest rates as quickly as he demanded. Critics argue that the attempt to oust Cook—the first Black woman to serve on the Fed Board—is a "brazen power grab" intended to intimidate the central bank into compliance.

Federal Reserve Chair Jerome Powell, who attended the hearing in a show of solidarity, has also faced pressure, including a recent Department of Justice investigation into central bank headquarters renovations.

What’s Next?

If the Court rules in favor of Cook, it will solidify the "red line" protecting the Federal Reserve from direct White House interference. If it sides with Trump, it could open the door for the President to replace any governor who disagrees with his economic agenda.

A final decision is expected by early summer. For now, a lower court injunction remains in place, allowing Cook to continue her duties and participate in the Fed’s upcoming interest-rate meetings later this month.