Kevin Hassett is now backing out of the race to lead the Federal Reserve, and Trump doesn’t seem to mind.
Kevin Hassett is now backing out of the race to lead the Federal Reserve, and Trump doesn’t seem to mind.
The White House economic adviser said on Fox News’ The Sunday Briefing that he and the president have been talking “from the beginning” about whether he’d be more useful staying in the West Wing or heading over to the Fed. “I don’t think he’s made a final call on that,” Hassett said.
But Trump already made it pretty clear last week where he stands. In front of cameras at a White House event, he looked right at Hassett and said, “I actually want to keep you where you are, if you want to know the truth.”
That was enough of a signal. And now Hassett is echoing it back. “There are a lot of great candidates,” he said Sunday, “and it could well be that the president’s right to make the decision that this is the best place for me right now.”
Hassett even added that he was “humbled and gratified” by the comment, calling Trump “such a good guy.”
Fed chair race narrows as Rieder gains late support
With Hassett out, the list is shrinking. It’s now seen as a four-man race. The names floating around are Christopher Waller, Kevin Warsh, and Rick Rieder.
Rick’s stock is rising fast. People familiar with the process say his nomination may have a better shot in the Senate. The idea is simple: he’s seen as easier to confirm, and in the current climate, that matters.
That climate, by the way, is now officially toxic. A criminal investigation has been opened into Jerome Powell. The case is about the huge costs tied to the remodel of the Fed’s Washington headquarters.
But everyone in D.C. knows what it’s really about. Powell refused to cave to Trump’s demand for lower rates. And now the Justice Department is coming after him.
Powell himself went public. In a video posted to the Fed’s site, he said: “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.”
The case relates to congressional testimony Powell gave on the cost overruns. The U.S. attorney for D.C., Jeanine Pirro, signed off on the subpoena.
Senate resistance grows as Powell and Cook face pressure
The whole thing has triggered real pushback, not from Democrats, but from inside Trump’s own party. Senator Thom Tillis, who sits on the Banking Committee, said any Fed nominee from Trump will now face even more scrutiny.
This is not the usual “lawfare” that Trump complains about. This time, the heat is coming from inside the GOP. And it might blow up the plan to replace Powell before his May 15 exit as chairman.
Even if Trump can’t fire Powell outright, he’s trying to change the makeup of the board. Under the 1913 law that created the Fed, governors serve 14-year terms, and they can only be fired “for cause.” That phrase has never really been defined. Powell can stay on the board until 2028 even if he loses the chair.
Meanwhile, Trump is also trying to remove Governor Lisa Cook over a separate accusation (mortgage fraud), which she denies. That’s turning into another legal fight. If Trump manages to push both Powell and Cook out, he could flip the balance.
Three of the current seven governors already lean toward his view of lower interest rates. Adding two more would tilt the whole board.
The search for a new chair is being led by Bessent, who Trump says pulled his own name out of consideration. And Trump keeps saying publicly that he’s not behind the Powell investigation. But then again, in his speech at the Detroit Economic Club, he smiled and told the crowd, “That jerk will be gone soon.”
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