Our new book is The Comeback: The 2024 Elections and American Politics. The second Trump administration has been full of ominous developments
For years, Federal Reserve Chair Jerome Powell has responded to President Trump’s broadsides in ways that generally avoided escalation.
That changed on Sunday night. In an extraordinary two-minute video message, Powell accused the administration of using the threat of criminal prosecution to pressure the Fed into lowering rates. He framed the Justice Department investigation as nothing less than a head-on challenge to the Fed’s ability to operate free of political control.
The subpoenas arrived late Friday. Powell, a lawyer by training, spent the weekend huddled with advisers, weighing how to respond. Powell made clear by releasing the video statement that he wasn’t going to let this play out in the shadows.
A criminal investigation of a sitting chair is without precedent. And Powell’s message was, too. It was wrapped in a directness that he had spent years avoiding. Powell often chooses his words carefully, and Sunday’s unusually stern delivery lacked the diplomatic off-ramp and studied neutrality of his past comments about the White House.
“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,” Powell said.
