Even fellow Republicans aren’t convinced by Donald Trump’s ideas about how the Federal Reserve should operate.
During his first term, and on the campaign trail, Trump has made it clear he wants some control over the Federal Reserve, the U.S.’s central banking system made entirely independent from the politics that control most of the government.
Economists have warned it’s a bad idea and even members of the GOP have raised concerns, albeit quietly.
“Trump made it very clear he wants cheap, easy money,” former Senator Pat Toomey told Politico. “Everyone in Congress is painfully aware of how disastrous that very policy can be.”
“You’ve got to put the greater good ahead of looking political,” Dan Muser, a Republican Representative from Pennsylvania, told Politico in September when Trump said the Fed should not lower interest rates before September.
Jerome Powell, chairman of the Federal Reserve, agreed, telling The New York Times DealBook Summit on Wednesday, “We’re supposed to achieve maximum employment and price stability for the benefit of all Americans and keep out of politics completely.”
Trump on the Federal Reserve:
— The Intellectualist (@highbrow_nobrow) October 22, 2024
"I feel the president should have at least say [on rates] in there ... I think I have a better instinct than, in many cases, people that would be on the Federal Reserve or the chairman" (August) @RiegerReport
pic.twitter.com/zkVMFumy3b
But Trump has said differently. In October, the president-elect told Bloomberg News he believes he should have “a say” in whether interest rates go up or down.
And while the institution will face some questions in Congress from both sides of the aisle - from Republicans who believe regulations are too prescriptive on the nation’s banks, to Democrats who feel the Fed hasn’t done enough to fortify the financial system - many Republicans stop far short of Trump’s demands.
For example, GOP Representative Frank Lucas of Oklahoma, who sits on the House Financial Services Committee, said the Fed “has worked really well”.
Lucas said the committee would “look at” suggestions from the Trump administration but “a certain degree of independence is necessary.”
Republican Senator Mike Rounds of South Dakota, a member of the Senate Committee on Banking, Housing, and Urban Affairs told Politico, “I like the way it’s setup right now.”
Other Republicans have made comments that clearly articulate they support an independent Fed.
Republican Senator Josh Hawley of Missouri previously said, “I don’t want [the Fed] to act in a political manner, I want them just to do their job.”
Senator Thom Tillis of North Carolina, who also sits on the Senate Finance Committee, told Politico the Fed should operate by its legal standard – not taking politics into consideration.
