Donald Trump’s advisor to the Fed, a new member, is joining the ranks of the Fed. Concerns about the central bank’s independence are growing.
Donald Trump’s economic advisor, Stephen Miran, has been appointed a new member of the Fed. His appointment renews concerns that interest rate decisions may begin to favor short-term political goals over economic stability.
Stephen Miran is the new member of the Federal Reserve
Just before the upcoming Fed meeting on September 17, the U.S. Senate confirmed Stephen Miran’s nomination as one of the seven members of the Federal Reserve Board. He will replace Adriana Kugler, who resigned just four months before the end of her term.
In 2020, during Trump’s first presidency, Miran served as a senior advisor at the Treasury Department before stepping down after Joe Biden’s election. He currently serves as chairman of the White House Council of Economic Advisers and previously announced that if Kugler were replaced, he would make independent decisions. However , he would not resign from his position, but would simply take an unpaid leave of absence (a Fed member’s term is 14 years, but Miran will serve until Kugler’s term expires in January 2026).
The presence of a Donald Trump advisor on the Fed board once again raises concerns about the independence of the institution that determines the cost of debt in the U.S. In an interview with NPR, Lisa Gilbert of Public Citizen said:
In practice, this means that he [Miran] remains a White House employee while also working for the, importantly, independent Federal Reserve.
Just before the vote, Democratic Senator Elizabeth Warren addressed Miran directly, writing:
… Your reaction to the August CPI [CPI inflation rose from 2.7% in July to 2.9%] will help lawmakers weigh their votes and assess whether you will be a truly independent voice for the Fed or remain a mouthpiece for President Trump, ignoring the real impact of his policies, which you helped design, on businesses, workers, and consumers.
Trump himself makes no secret of the fact that he is a proponent of low interest rates and has repeatedly attacked Jerome Powell in recent months for his hawkish policy. For this reason, Miran’s presence on the Fed board ahead of the upcoming meeting could become a political tool facilitating Trump’s goal of larger rate cuts.
However, taking advantage of Kugler’s resignation and appointing Miran are only part of the crusade against the central bank.
In August, the Trump administration also attempted to recall Lisa Cook, who had been appointed to the position by Joe Biden, from the Fed . She was accused of committing fraud—Cook allegedly declared two properties as her primary residences to help her obtain better credit terms. An appeals court rejected the attempt to remove her, finding the accusations did not meet the grounds for dismissal under the law governing the removal of Fed members.
