Donald Trump has renewed efforts to remove Lisa Cook, a governor on the Federal Reserve Board, after the Supreme Court previously blocked an attempt to dismiss her. Cook, who was nominated to the Fed's Board of Governors by President Joe Biden, has been a target of Trump's efforts to gain greater control over the central bank.
The Supreme Court blocked Trump's initial attempt to fire Cook in June. The Trump administration is now appealing a lower-court ruling that favored Cook, following the Supreme Court's decision to allow her to remain in her post while her lawsuit challenging the firing proceeds.
A White House aide, Dan Scavino, sent a letter to Cook this week stating that Trump was "considering removing you from your position." The letter cited the Supreme Court's requirement for proper notice and gave Cook until August 26 to challenge the action.
The attempt to remove Cook is linked to a criminal referral made in August by Bill Pulte, director of the Federal Housing Finance Agency. Pulte accused Cook of mortgage fraud for declaring two different homes as her primary residence, a designation that can allow for lower mortgage rates or smaller down payments.
Cook has defended herself, asserting that the president's attempt to oust her was based on a "manufactured pretext" because she refused to "bow to political pressure" and made interest rate decisions solely for the benefit of the American people. Her attorney, Abbe Lowell, told CNN that they had anticipated Trump's renewed efforts, stating that he "doesn't take no for an answer whether the no is an advisor or the Supreme Court."
Lowell also suggested that Trump's actions might be in response to Cook's criticisms of recent jobs reports and her stance on inflation. "All Lisa Cook has been doing is her job," Lowell said, emphasizing the Federal Reserve's role as an independent economic entity, which he believes does not sit well with Trump.
Lowell further argued that the allegations against Cook do not constitute grounds for removal "for cause" and expressed confidence in proving this publicly. "There is not a chance Governor Cook committed mortgage fraud," he stated.
The June ruling that prevented Trump from immediately firing Cook was a 5-4 decision. Justices Sonia Sotomayor, Elena Kagan, and Ketanji Brown Jackson, joined by conservatives Chief Justice John Roberts and Justice Brett Kavanaugh, formed the majority.
Trump's attempt to fire Cook marked the first time in the Federal Reserve's history that a sitting governor had been targeted for dismissal. Federal Reserve members are legally protected from being fired without cause, a measure designed to ensure the institution's operational independence from political influence.
During oral arguments concerning Cook's removal, Trump's legal team struggled to gain support from the justices. Concerns were raised about the lack of notice and an opportunity for Cook to contest her removal. Justice Brett Kavanaugh noted that allowing immediate removal without due process could undermine the independence of the Federal Reserve.
Justice Samuel Alito acknowledged that the allegations against Cook had not been explored by any court and expressed concern about the "very hurried manner" of the removal request.
While the Supreme Court's decision to keep Cook on the Fed board during the case's review was significant, the court also ruled in favor of Trump's effort to remove Federal Trade Commissioner Rebecca Slaughter. That 6-3 ruling, which overturned long-standing precedent, grants presidents more power to reshape the boards of various federal agencies, including the National Labor Relations Board and the Consumer Product Safety Commission.
In her dissent to the FTC ruling, Justice Sotomayor wrote that the court had "discarded [the] democratic regime created by the Constitution" and granted the president "far greater power than ever before."