Washington, DC, April 28, 2026 --  

Attempts to bully the Federal Reserve into serving the president's wishes are doomed to fail.

As Federal Reserve Chairman Jerome Powell heads his last Open Market Committee meeting tomorrow, fears of America's central bank losing its independence have nearly evaporated. Over the past year, Powell has stared down President Trump despite his bullying and held firm. Powell has won the fight with interest rates unchanged since December.

Trump's dispute with Powell dates back to shortly after Trump appointment him chairman during the his first term. The Federal Reserve repeatedly raised interest rates that year causing Trump to start semi-public grumbling about the need for Powell's removal.

This grumbling turned to open threats to fire Powell when Trump returned to office last January. Undeterred by legal counsel that the president cannot fire Federal Reserve governors without cause, Trump's politicized Department of Justice opened a dubious criminal investigation of Powell for cost-overruns on renovations at the Federal Reserve headquarters. This investigation served as legal fig leaf for a Trump to attempt to fire Powell.

The Justice Department reluctantly dropped that investigation last week -- as demanded by Republican Senator Thom Tillis who had blocked his committee from confirming Trump's new fed chairman pick. This had raised the possibility of a stalled confirmation allowing Powell to temporarily remain in office as chairman pro tempore. This would have been highly embarrassing spectacle -- Powell getting an extended tenure as a consequence of Trump's efforts to fire him. With charges dropped, Thillis agreed to proceed to support nominee Kevin Warsh, unblocking his confirmation.¹

Will Warsh start lowering interest rates as he serve as Trump's loyalist toady? Unlikely.

Warsh is best known as an inflation hawk more likely than his colleagues to increase interest rates when last serving the Fed in the wake of the financial crisis. Whatever Warsh may have promised Trump in private in order to secure his nomination, he will be under no legal obligation to obey Trump once he takes office. The same was true for Jerome Powell (a Trump appointee turned adversary) and several Supreme Court Justices appointed by Trump who have since defied him.

And even if Warsh wanted to serve as Trump's toady, he wouldn't be able to change policy. While he will have some unofficial influence as chairman, he is just one vote of 12 on the Fed's Open Market Committee that sets interest rates.

Warsh's vote will replace that of Stephen Miran. If there ever was a Trump toady on that Fed it would be him. Miran is a short-term bench warmer governor at the Fed who also headed up Trump's Council of Economic Advisers working on his tariff plans (since ruled illegal), and originally planned to return to that role after leaving the Fed. Since joining the board last September, Miran voted to lower interest rates between 1/4 and 1/2 percent at every single meeting, dissenting with the majority every time except November when the majority also voted to lower rates by 1/4 percentage point.² Miran only resigned from the Trump administration under pressure from Senate Democrats who disapproved of him being on the Fed board and in the Trump administration at the same time.

Since the Iran war started in February, higher oil prices have raised the risk of inflation, creating strong headwinds against the Fed lowering interest rates. U.S. inflation shot up to an annualized rate of 3.3 percent in March, led by fuel prices, according to the Bureau of Labor Statistics all items index.³ Amazingly Trump toady Stephen Miran, still voted to lower interest rates in March -- the sole committee member voting to do so. And if Warsh does follow Miran to become a regular dissident for lowering rates, he will destroy his authority as chairman to influence his colleagues. Only a fool would follow this path -- expect Warsh to vote with the majority of his colleagues and maintain the status quo.

Trump's last remaining effort to lever the Federal Reserve is his attempted firing of governor Lisa Cook for alleged mortgage fraud based on declaring two homes as her primary residence. Federal courts have ruled that Cook can stay at the Fed pending a Supreme Court ruling expected this summer, but legal analysts widely expect the the Trump administration to lose the case and Cook to retain her seat.⁴

That decision in the Cook case will likely be a welcome the nail in the coffin for Trump's Federal Reserve meddling. He'll still get the chance to influence the Fed by appointing at least one more governor, or more if there are early resignations. Jerome Powell might resign his governor seat after his chairmanship ends May 15 or who might stay on until his governor seat expires in 2028. But regardless of when this happens, it is unlikely to move the needle much, especially given Trump's defeats on all other fronts.

Related Web Columns:

Careful What You Wish For, May 15, 2025

Notes:

1. CNBC, Tillis Ends Block of Fed Chair Nominee Warsh, Clears Way for Trump Pick, April 26, 2026

2. Federal Reserve, Federal Open Marker Committee Meeting Calendars, Statements, and Minutes (2021-2027), as posted April 28, 2026

3. Bureau of Labor Statistics, Consumer Price Index - March 2026, April 10, 2026

4. National Public Radio, Supreme Court Doubtful of Trump Claim He Can Fire Fed Governors by Fiat, January 21, 2026