President Donald Trump's effort to remove a member of the Federal Reserve's Board of Governors comes amid his push to reshape the composition of the central bank's panel that makes interest rate decisions.
Trump attempted to fire Fed Governor Lisa Cook for cause this summer, accusing her of mortgage fraud and marking the first time a president has ever attempted to remove a Fed governor from office in the central bank's 112-year history. Cook has denied wrongdoing and filed suit to block her firing, with the Supreme Court to hear arguments in January after lower courts sided with Cook.
"President Trump lawfully removed Lisa Cook for cause from the Federal Reserve Board of Governors," White House spokesman Kush Desai told FOX Business. "We look forward to ultimate victory after presenting our oral arguments before the Supreme Court in January."
The Fed's Board of Governors is a seven-member body led by Fed Chair Jerome Powell.
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The seven Fed governors all serve on the 12-member Federal Open Market Committee (FOMC), which is the panel that is responsible for setting interest rate policy and adjusting the target range for the benchmark federal funds rate as needed to fulfill the Fed's dual mandate of maximum employment and price stability in-line with the Fed's 2% long-run inflation target.
The FOMC has five other members who include the New York Fed president, as well as four positions that rotate annually among the presidents of the regional Federal Reserve banks.
To help insulate policymakers from political pressure, members of the Fed's Board of Governors serve 14-year terms that are staggered across presidential administrations. That allows them to make monetary policy moves based on their view of economic conditions, rather than being subject to political influence and potential removal if they don't do the bidding of a given administration.
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Currently, four of the seven members of the Fed's Board of Governors were appointed by Republicans, with Powell, Michelle Bowman, and Christopher Waller appointed to their roles during Trump's first term, and Stephen Miran, who was confirmed to the role last month.
Miran's current term only runs through Jan. 31, 2026, as it's the remainder of the term that belonged to former Fed Governor Adriana Kugler, who resigned in August. He may be reappointed to the role to fill the next term for that seat, as he hasn't served a full-term, though it's unclear at this time whether he will return to the Trump administration or be nominated to stay on the Fed's board.
If Trump's effort to remove Cook from the Fed is successful, it would give him the opportunity to nominate another governor who would serve on the Fed's board over the long-term – as Cook's term doesn't expire until 2038. Cook was confirmed in 2022 for her initial term with a party line vote of 51-50 when then Vice-President Kamala Harris had to cast the tie-breaking vote in her role as President of the Senate. She was confirmed again in 2023 for a full 14-year term by a vote of 51-47.
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Other than the Fed governor post currently filled by Miran that opens in January and the potential removal of Cook pending the outcome of her lawsuit, only one other governor's term is scheduled to expire in the remainder of Trump's term.
Fed Chair Jerome Powell's term as chairman expires in May 2026, although he may continue to serve out his term as a member of the board through January 2028 if he chooses to do so. Powell hasn't indicated whether he plans to resign from his role as a Fed governor when his term as chairman expires.
While recent Fed chairs have resigned and left the central bank entirely after their terms as chair ended, it wouldn't be unprecedented for Powell to remain as a governor.
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That dynamic played out most recently with Marriner Eccles, who served as Fed chair from 1934 to 1948, then remained on as a member of the Fed's board of governors until 1951.
FOX Business' Amanda Macias contributed to this report.
