On May 31, Powell made these remarks at the John F. Kennedy Courage Award ceremony in Boston, stating, "If any administration finds a way to dismiss Fed officials for policy differences, future administrations will do the same."
He described the trust built over decades in the Fed as an "invaluable asset" and emphasized the obligation of himself and his colleagues to protect it.
Powell also noted that the administration has "no role whatsoever" in the appointment or oversight of the 12 regional Federal Reserve Bank presidents. These regional presidents participate in interest rate decisions alongside Fed governors appointed by the president, reaffirming the need for monetary policy decisions to remain independent from the White House.
The Wall Street Journal highlighted that Powell's comments suggest why he has remained on the Fed Board after stepping down as chair, as it is common for Fed chairs to leave public office after their term.
Powell's statements come as the Supreme Court is expected to soon rule on President Donald Trump's attempt to dismiss Fed Governor Lael Brainard. Trump sought to remove Brainard over allegations of mortgage fraud. Fed governors can only be dismissed for "just cause," not merely policy disagreements.
The Trump administration contends that such actions are not an attack on the Fed's independence but rather a move to restore accountability. Treasury Secretary Scott Vessenet recently referred to Kevin Warsh, the new Fed chair, as the "new sheriff," asserting that he will return the Fed to its foundational principles of accountability and trustworthiness.
In his speech, Powell acknowledged the need for institutional reform while stressing the importance of preserving the institution.
* This article has been translated by AI.
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