Supreme Court seems skeptical of Trump鈥檚 firing of Fed board member
Federal Reserve governor Lisa Cook, accompanied by lawyer Abbe Lowell, looks on outside the U.S. Supreme Court as the justices consider President Donald Trump's effort to fire her, in Washington, Jan. 21, 2026.
Nathan Howard/Reuters
The independence of the Federal Reserve appeared front of mind for the U.S. Supreme Court Wednesday as the justices heard oral argument in a case about the firing of a member of the central bank鈥檚 board.
While the high court has in other recent cases appeared inclined to give the president of the United States more power to fire the leaders of executive branch agencies, this time it expressed skepticism 鈥� sometimes in stark terms 鈥� about giving the president more authority to remove officials who guide the country鈥檚 monetary policy.
鈥淏ig picture, it seems this would [lead to] a what-goes-around-comes-around. All the governors would be removed鈥� after a presidential election, said Justice Brett Kavanaugh, and 鈥渨e would really [have] at-will removal.鈥�
Why We Wrote This
A majority of Supreme Court justices appeared wary of President Donald Trump鈥檚 attempt to remove a member of the Federal Reserve Board, given the central bank鈥檚 importance to the U.S. economy.
History has shown, he added, that 鈥渙nce these tools are unleashed, they are used by both sides.鈥�
President Donald Trump criticized board members of the Fed for months for refusing to lower interest rates as much as he would like. Past presidents have done the same, but because federal law held that they could only dismiss members of the Fed 鈥渇or cause鈥� 鈥� and because they were wary of causing instability in financial markets 鈥� public criticism is as far as they went.
In August, Mr. Trump went a step further. He fired Lisa Cook, a member of the Fed鈥檚 Board of Governors, over allegations that she committed mortgage fraud. The mortgage fraud allegations were 鈥渃ause鈥� for her dismissal, Mr. Trump contended in a . Ms. Cook, who has denied the allegations, has not been formally charged. Days after her dismissal, she filed a lawsuit challenging it.
A District Court judge in her favor in September. The judge temporarily reinstated her to the Fed board, pending the conclusion of the lawsuit, on the reasoning that her removal likely was unlawful. An appeals court agreed, and Mr. Trump appealed to the Supreme Court.
Throughout oral argument on Wednesday, the lawyers and justices in the courtroom agreed on one point: the Supreme Court鈥檚 assertion 鈥� in an issued earlier this term in a separate case 鈥� that Fed governors are entitled to stronger removal protections because the central bank is 鈥渁 uniquely structured, quasi-private entity.鈥�
Among many other things, the justices questioned whether they should resolve such a weighty case 鈥� with implications for presidential power and for the global economy 鈥� when the case has faced so little scrutiny in the lower courts.
鈥淚s there any reason this whole matter had to be handled ... in such a hurried manner?鈥� asked Justice Samuel Alito, a member of the court鈥檚 conservative majority. No court, he said, 鈥渆xplored those facts鈥� around Ms. Cook鈥檚 alleged mortgage fraud.
Justice Sonia Sotomayor, one of the court鈥檚 liberal members, agreed.
鈥淲e know the independence of the agency is very important,鈥� she said. 鈥淲aiting, at least for lower courts to look at these issues first, seems best for the country鈥檚 confidence, and the world鈥檚 confidence.鈥�
Several important questions remain unanswered in the Cook case, the justices noted. Does Mr. Trump鈥檚 social media post amount to giving Ms. Cook 鈥渘otice鈥� of her firing? If so, was she given an appropriate opportunity to respond? How much should it matter that the alleged fraud occurred before she became a Fed governor? Would the alleged fraud, if proved, be simple 鈥渘egligence鈥� or, as the Trump administration claims, 鈥済ross negligence鈥� that justifies removal from office?
John Sauer, the U.S. solicitor general, argued that Ms. Cook, a person who helps to set interest rates for the entire country, appears to be 鈥減laying fast and loose and trying to get a favorable mortgage rate for herself.鈥� That, he said, is causing 鈥済rievous reputational harm to the Federal Reserve.鈥�
Thus, he concluded, the court should remove the temporary injunction barring Ms. Cook鈥檚 termination.
And not only that: While Mr. Sauer emphasized that Fed board members can only be removed 鈥渇or cause,鈥� he argued that there are limits to when courts can review a president鈥檚 determination of what that 鈥渃ause鈥� is.
鈥淭he President has made a determination, it clearly does relate to conduct, fitness, ability, or competence for that office,鈥� he said. 鈥淎t that point, there鈥檚 no work for the reviewing court to do. The traditional discretion to the President鈥檚 determination would kick in.鈥�
Ms. Cook鈥檚 lawyer, Paul Clement, countered that there 鈥渘eeds鈥� to be judicial review, especially of what the president determines 鈥渇or cause鈥� to be.
鈥淚f there鈥檚 no judicial review, then this is all kind of a joke,鈥� he added.
As the Supreme Court debates how to resolve this case, external pressure continues to mount. Jerome Powell, the Fed chair, attended Wednesday鈥檚 argument. Earlier this month, he announced that he was also facing criminal investigation by the Trump administration. He he鈥檚 being targeted because the Fed didn鈥檛 follow Mr. Trump鈥檚 desire for lower interest rates.
A decision in the case is expected by the summer.