Every living former Federal Reserve chair joined with other leading economic policymakers from decades past have issued an urgent warning to the U.S. Supreme Court about President Donald Trump.
Those policymakers – including Fed chairs Alan Greenspan, Ben Bernanke and Janet Yellen –filed a friend-of-the-court brief Thursday arguing for greater independence for central banks as justices consider whether to block the president from firing Fed governor Lisa Cook, reported CNBC.
“Allowing the removal of Governor Lisa D. Cook while the challenge to her removal is pending would threaten that independence and erode public confidence in the Fed,” the amicus brief said.
The filing warned that allowing Trump to remove Cook while her legal challenge plays out would erode safeguards protecting the central bank from the executive branch that had been established 90 years ago by Congress.
"[Allowing Cook's removal] would expose the Federal Reserve to political influences, thereby eroding public confidence in the Fed’s independence and jeopardizing the credibility and efficacy of U.S. monetary policy," the brief added.
The brief was also signed by former Treasury secretaries Robert Rubin, Larry Summers, Hank Paulson, Jack Lew, and Timothy Geithner; former White House Council of Economic Advisers chairs Glenn Hubbard, Greg Mankiw, Christina Romer, Cecilia Rouse, Jared Bernstein and Jason Furman; and former Fed Governor Dan Tarullo.
Signatories had served under or been appointed by both Democratic and Republican presidents, and the brief was also signed by economists Ken Rogoff, Phil Gramm and John Cochrane, as well as Phil Gramm, a Republican who previously served as chairman of the Senate Banking Committee.
Cook's must respond by Thursday at 4 p.m. to arguments by the Justice Department that Trump should be allowed to remove her from the seven-member Fed Board of Governors while the high court considers whether he has the authority to fire her over alleged mortgage fraud.
