Trump should bring the Fed to heel
President Trump’s criticism of Jay Powell has increasingly triggered calls for the Federal Reserve’s independence. But those defending Powell’s autonomy are making ahistorical claims about the Fed’s relationship to the executive and legislative branches of government: the Fed has never been independent. The president appoints the Fed’s chairman. The bank enjoys broad authority to implement the policies necessary to achieve its mandates of stable prices, full employment and interest-rate stability, but these objectives are defined by Congress and could be altered by Congress. Congress created the Federal Reserve in 1913 and has amended the Federal Reserve Act more than 200 times. It could do so again.
