Daijiworld Media Network – Washington

Washington, Sep 16: A U.S. appeals court on Monday denied former President Donald Trump’s attempt to remove Federal Reserve Governor Lisa Cook, marking the first time in history a president has sought such action since the central bank’s establishment in 1913. The ruling preserves Cook’s participation in the Fed’s policy meeting this week, where the central bank is expected to cut interest rates to address a cooling labor market.

The DC Circuit Court rejected the Justice Department’s request to stay a judge’s order temporarily blocking Cook’s removal. U.S. District Judge Jia Cobb had ruled that Trump’s claims of pre-confirmation mortgage fraud against Cook were unlikely to constitute valid grounds for dismissal under the law establishing the Fed. The decision was 2-1, with Circuit Judges Bradley Garcia and J. Michelle Childs siding with Cook, and Trump appointee Gregory Katsas dissenting.

Judge Garcia, joined by Childs, highlighted that Cook had been denied due process, writing that the government “provided Cook no meaningful notice or opportunity to respond” to the allegations. The court noted that because her due process claim is “very likely meritorious,” it did not need to interpret the meaning of the law’s “for cause” removal provision at this stage.

Cook, the first Black woman to serve as a Fed governor, sued Trump and the Fed in late August, asserting that the removal attempts were politically motivated, aimed at influencing her stance on monetary policy. The Trump administration argued the president has broad discretion to remove Fed governors, but courts have historically shielded the Fed from political interference to preserve its independence.

The case has far-reaching implications for the Fed’s autonomy, critical for decisions like controlling inflation and managing interest rates. Trump has repeatedly pressured the Fed to cut rates, clashing with Chair Jerome Powell’s approach focused on inflation control.

Separately, the Senate confirmed Trump’s nominee Stephen Miran to a Fed board seat in a 48-47 vote, meaning both Miran and Cook will attend this week’s rate-setting meeting.

The ongoing legal battle underscores the unprecedented nature of the case, testing long-standing protections designed to keep the Federal Reserve independent from political pressure.