In a high-stakes showdown that could redefine the boundaries of executive power, the Supreme Court appeared deeply skeptical Wednesday of President Donald Trump’s attempt to fire Federal Reserve Governor Lisa Cook.
During nearly two hours of oral arguments, a broad coalition of justices—including several of the court’s most conservative members—expressed alarm over the administration’s claim that a president has the “unreviewable” authority to remove central bank officials. The case, Trump v. Cook, is being watched as an existential test for the Federal Reserve’s century-old shield against political interference.+1
“Your position… would weaken, if not shatter, the independence of the Federal Reserve,” Justice Brett Kavanaugh told Solicitor General D. John Sauer. Kavanaugh, a Trump appointee, warned that allowing a president to fire a governor over social media without a formal process would incentivize a cycle of “search and destroy” tactics every time the White House changes parties.
The Mortgage Allegations: Fraud or Pretext?
The administration’s case for firing Cook rests on allegations that she committed mortgage fraud in 2021—before joining the Fed—by claiming two different properties in Michigan and Georgia as her “primary residence” within a two-week span.
Trump announced the firing on Truth Social last August, claiming “sufficient cause” due to “deceitful and potentially criminal conduct.” However, Cook has denied any wrongdoing, and her legal team argued the discrepancies were “inadvertent mistakes” on complex paperwork.+1
Chief Justice John Roberts seemed to downplay the severity of the alleged misconduct, questioning how significant such errors are in the “stack of papers” required for real estate transactions. Justice Sonia Sotomayor was even more blunt, calling the “firing-by-social-media” irregular and noting it provided Cook zero opportunity to be heard.
The Fed Under Fire
The courtroom was a tableau of the broader war between the White House and the central bank. Sitting in the front row was Fed Chair Jerome Powell, who himself is currently the target of a Department of Justice investigation over headquarters renovations—a probe he has dismissed as political retaliation for the Fed’s refusal to slash interest rates.
The Legal Stakes:
- “For Cause” Removal: Under the Federal Reserve Act, governors can only be removed “for cause.” The administration argues the President alone determines what “cause” means.+1
- Due Process: Cook’s lawyer, Paul Clement, argued that she was entitled to a hearing and notice before being ousted.
- Market Stability: Several justices raised concerns that a ruling in Trump’s favor could destabilize global markets by making the Fed a “subservient” wing of the executive branch.
“No judicial review, no process, nothing. You’re done,” Kavanaugh remarked, summarizing the government’s stance. “What are we doing when we have a system that leads to that?”
A Split from Previous Rulings?
The skepticism displayed Wednesday marks a potential departure from the Court’s recent trend of expanding presidential removal power over other “independent” agencies, such as the National Labor Relations Board.
The justices appeared to view the Federal Reserve as a “uniquely structured” entity whose insulation from politics is critical to the U.S. economy. Even Justice Amy Coney Barrett expressed caution, noting that while she is a judge and not an economist, the “risk” of destabilizing the Fed counselled against a hasty ruling in favor of the President.
The Path Ahead
If the Court rules in Cook’s favor, it would be a major blow to the administration’s “Maximum Pressure” campaign against the Fed. A decision is expected by early summer, but the justices hinted they might issue an interim order even sooner to keep Cook in her seat while the case returns to lower courts for further fact-finding.
For now, Lisa Cook remains on the board, participating in rate-setting meetings and casting votes—a living symbol of the institutional wall that Trump is determined to tear down.