Trump Fires Fed Governor Lisa Cook, Sparks Legal and Political Clash
In Washington, a dramatic escalation has unfolded between President Donald Trump and the Federal Reserve, centering on Fed Governor Lisa Cook. Trump has announced that Cook is being fired, accusing her of mortgage fraud and saying she was “not above board.” He declared the move both at a marathon cabinet meeting and later on social media, insisting that immediate action would be taken.
But the situation is far from straightforward. By law, Federal Reserve governors are granted strong protections to insulate them from political pressure, and removal is allowed only under very specific circumstances. Cook herself has said that Trump has no authority to remove her, and through her attorney, she has vowed to challenge the action in court. A lawsuit is being prepared, setting the stage for a major legal battle over the independence of America’s central bank.
Trump’s remarks came during an unusually long cabinet meeting, one that stretched more than three hours in front of reporters. He cast the decision as part of his wider push to get the Federal Reserve to cut interest rates, which he believes are hurting the housing market. Interest rates currently sit between 4.25 and 4.5 percent, and Trump has repeatedly blamed Fed Chair Jerome Powell for not lowering them. While Trump admitted Powell was “not a bad person,” he continued to criticize the Fed’s decisions, signaling that the fight is far from over.
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Democrats quickly pushed back. House Minority Leader Hakeem Jeffries accused Trump of trying to take over the Federal Reserve, comparing the move to authoritarian tactics. Senate Minority Leader Chuck Schumer went further, saying the attempt to remove Cook risked shredding the independence of the Fed and threatening the savings and mortgages of millions of Americans. He described Trump’s move as “a dangerous game of Jenga with the economy.”
Legal experts are also weighing in. Robert Hockett, a professor at Cornell Law School, pointed out that Fed governors cannot simply be removed on the president’s whim. The mortgage allegations against Cook, he argued, are flimsy and not enough to justify dismissal. Supporters of Cook say the accusations stem from a technicality over declaring a primary residence, something not uncommon in real estate transactions.
The Federal Reserve itself responded carefully, emphasizing that its independence is a cornerstone of U.S. economic stability and pledging to continue carrying out its duties regardless of political pressure. It also noted that the courts will ultimately decide whether Cook remains in her position.
Trump, when pressed on the matter, insisted he would “abide by the court.” Still, his comments and actions have already rattled investors, with some saying they have “never seen this before.” The uncertainty has raised questions about how far Trump may go in reshaping the central bank and what that might mean for U.S. economic policy.
So, while Trump claims victory in removing Lisa Cook, the reality is that this decision is now headed straight into the courts. The outcome could reshape the balance between the White House and the Federal Reserve, and with interest rates, jobs, and mortgages at stake, it is a story that Americans will be watching very closely.
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