Trump Opens a Bogus Investigation Against the Fed Chief for Refusing to Slash Interest Rates

Donald Trump has long been putting political pressure on the Federal Reserve to lower interest rates to give a short-term boost to the economy that would help Trump politically (at the long-term cost of higher inflation). He has already ordered his underlings to trump up bogus criminal charges against a Fed governor, and now he is targeting the Fed’s chairman for retribution.

The New York Times reports:

The U.S. attorney’s office in the District of Columbia has opened a criminal investigation into Jerome H. Powell, the Federal Reserve chair, over the central bank’s renovation of its Washington headquarters and whether Mr. Powell lied to Congress about the scope of the project, according to officials briefed on the situation.

The inquiry, which includes an analysis of Mr. Powell’s public statements and an examination of spending records, was approved in November by Jeanine Pirro, a longtime ally of President Trump who was appointed to run the office last year, the officials said. …

The Fed chair warned that the investigation signaled a broader battle over the Fed’s independence. “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president,” Mr. Powell added. “This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions—or whether instead monetary policy will be directed by political pressure or intimidation.”

The independence of the Federal Reserve has been one of the few remaining holdouts against Trump’s attempt to centralize all power in his person and have every agency run by his lackeys. In this case, Trump’s takeover of the Justice Department, which is no longer insulated from direct presidential control, makes this next takeover more likely.

The Executive Watch is a project of the Institute for the Study of Modern Authoritarianism, and its flagship publication The UnPopulist, to track in an ongoing way the abuses of the power of the American presidency. It sorts these abuses into five categories: Personal Grift, Political Corruption, Presidential Retribution, Power Consolidation, and Policy Illegality. Click the category of interest to get an overview of all the abuses under it.

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