Greenspan, Bernanke and Yellen urge Supreme Court to let Lisa Cook keep her job as a Fed governor
**Former Fed Chairs Urge Supreme Court to Preserve Federal Reserve’s Independence, Support Governor Lisa Cook**
*Washington, D.C. —* Alan Greenspan, Ben Bernanke, Janet Yellen, and other former top economic officials appointed by presidents from both political parties have urged the Supreme Court to preserve the Federal Reserve’s political independence and allow Lisa Cook to remain a central bank governor for now.
The Supreme Court is currently considering an emergency appeal from the administration seeking to remove Cook while her lawsuit challenging her firing by former Republican President Donald Trump proceeds through the courts.
This White House campaign to unseat Cook marks an unprecedented effort to reshape the Fed board, which was established to be largely independent from day-to-day politics. Notably, no president has ever fired a sitting Fed governor in the agency’s 112-year history.
Earlier in September, a judge ruled that Trump’s attempt to fire Cook was likely illegal. Subsequently, an appeals court rejected an emergency plea to remove Cook before the Fed’s meeting last week, where she participated in a vote to cut a key interest rate by one-quarter of a percentage point. Following that meeting, the administration turned to the Supreme Court, again requesting her prompt removal.
In their Supreme Court filing, lawyers representing the former economic officials warned that immediately ousting Cook “would expose the Federal Reserve to political influences, thereby eroding public confidence in the Fed’s independence and jeopardizing the credibility and efficacy of U.S. monetary policy.”
Greenspan, Bernanke, and Yellen served as successive chairs of the Fed’s seven-member Board of Governors, spanning six presidential administrations starting from 1987. Greenspan and Bernanke were initially appointed by Republican presidents Ronald Reagan and George W. Bush, respectively. President Barack Obama nominated Yellen to the Fed, and she later served as Treasury Secretary under Democratic President Joe Biden.
The letter also included signatures from other treasury secretaries, heads of the Council of Economic Advisers, and former Senator Phil Gramm (R-Texas), former chairman of the Senate Banking, Housing, and Urban Affairs Committee.
Trump sought to fire Cook on August 25, but a judge allowed her to remain in her position. Trump accused Cook of mortgage fraud because she reportedly claimed two properties—in Michigan and Georgia—as “primary residences” during June and July 2021, prior to joining the Fed board. Such claims can qualify homeowners for lower mortgage rates and smaller down payments than if a property is declared a rental or second home.
Cook has denied any wrongdoing and has not been charged with a crime. Documents obtained by The Associated Press indicate that Cook described her Atlanta condominium as a “vacation home” in a loan estimate from May 2021 and as a “second home” on a security clearance form, both of which contradict the administration’s allegations of fraud.
This attempt to dismiss Cook differs markedly from Trump’s previous firings of board members at other independent agencies, such as the National Labor Relations Board, Federal Trade Commission, and Consumer Product Safety Commission, where removals were done at will. The Supreme Court has so far allowed those firings to proceed but has cautioned that the Federal Reserve should be treated differently.
Trump has cited the provision of law establishing the Federal Reserve that allows governors to be dismissed “for cause” in justifying his attempt to remove Cook.
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https://www.phillytrib.com/news/greenspan-bernanke-and-yellen-urge-supreme-court-to-let-lisa-cook-keep-her-job-as/article_ebfcbdbd-16c8-46e5-a087-866e59c5d7e5.html
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