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We have to talk about the Constitutional standoff between Donald Trump and this woman, Lisa Cook.
Because Trump just said “you’re fired,” she replied “no I’m not,” and now nobody knows what’s going to happen.
Right, so for context, you should know who Lisa Cook is, and why many people say she’s one of the few people keeping Trump from wrecking the American economy more than he already has.
In short, she’s a very accomplished economist, professor, and since 2022 the first Black woman to serve on the board of the Federal Reserve. [Image]
With Biden appointing her to a 14-year term that ends in 2038, that is, unless she’s removed for cause by the President. [Headline/image]
And now, that’s exactly what Trump is attempting to do, though it’s unclear whether he actually can.
Right, because the law that created the Federal Reserve in 1913 didn’t specify what a legitimate “cause” for removing a board governor would be.
So legal experts generally agree it’s some kind of malfeasance or dereliction of duty, but the question’s never been tested in court because no president in history has ever tried to do this.
But if we know anything about Trump, it’s that he loves bulldozing norms.
So the malfeasance he’s alleging is that in 2021, Cook apparently listed two different properties as her primary residence within two weeks while applying for mortgages on both.
And for context, lenders generally give lower interest rates for primary residences because they’re seen as less risky.
So Trump’s argument is that there’s no legit reason she would have two primary residences at once, therefore this is fraud.
However, when CNN reviewed the mortgage documents, they listed her properties as principal residences, not primary residences.
And as experts have pointed out, it’s possible to have more than one principal, and even if it wasn’t, borrowers often don’t even read these specific documents, so her intent would be hard to prove.
But regardless, in the past week Trump has called on Cook to resign, then threatened to fire her, and now announced that he’s actually firing her.
Which, if his order stands, could give Trump unprecedented control over the Fed.
Right, because he’s already got two appointees on the board from his first term, and this month another member resigned six months earlier than expected.
So Trump quickly put one of his own people in her place, and now, if he replaces Cook too, that would give him four allies on the seven-member board.
Though to actually change interest rates, he would need a majority on the broader 12-member committee of which the board is a part, and that includes five presidents of the regional Fed banks.
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Produced by: Cory Ray, Philip DeFranco
Edited by: James Girardier, Maxwell Enright, Julie Goldberg, Christian Meeks, Matthew Henry
Art Department: William Crespo
Writing/Research: Chris Tolve, Philip DeFranco
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#DonaldTrump #Inflation #LisaCook
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