THE FEDERAL RESERVE IS ONE OF THE MOST powerful institutions in the world. As the central bank of the United States, it controls the U.S. money supply and (to a considerable degree) interest rates, and also has powerful tools to provide financial markets liquidity. It would not be an overstatement to say that the Federal Reserve saved the global financial system during the 2008 financial crisis.

And it is just one of many essential government institutions led, staffed, and maintained by experts that has been under threat from the Trump administration.

President Trump has been harshly critical of the Fed and its chair, Jerome Powell, whom Trump himself first nominated to the position in 2018. Trump has called Powell a “major loser” and after returning to the White House spent weeks teasing the possibility of firing him—“If I want him out, he’ll be out of there real fast, believe me”—before walking back from the brink. On April 22, hoping to calm economic turmoil triggered by his tariffs, Trump said he had “no intention” of firing Powell. The president repeated that position as recently as this past Sunday. “No, no, no,” said Trump when asked on Meet the Press whether he would fire the Fed chair before his term is up in 2026. “Why would I do that? I get to replace the person in another short period of time.”

Trump’s second term has seen the mass firing of government employees, with many more firings expected as he reportedly plans to strip civil service protections from huge swaths of federal workers. But the president’s powers over independent agencies is constrained by law. Trump has challenged the constitutionality of those laws by attempting to fire members of the National Labor Relations Board and the Merit Systems Protection Board. The Supreme Court is expected to take up that question, and in doing so could issue a ruling that might have dire consequences for many independent agencies—and for the independence of the Federal Reserve. At issue is a 1935 Supreme Court decision upholding statutory limits on presidential authority to fire members of independent agencies, a precedent critical to the Federal Reserve’s status.

In setting up the Federal Reserve, Congress designed it to be largely independent of the president. The Federal Reserve chairman serves a set term and can be removed only for cause. The Fed’s Board of Governors is appointed by the president, again for a set term, so that at any given time, the Board will have appointees of several presidents. Monetary policy is set by the Federal Open Market Committee, which is made up of the Board of Governors as well as presidents of the twelve Federal Reserve Banks (of whom five vote at any given time). Importantly, each Federal Reserve Bank president is chosen by that bank’s directors, not the president.

Congress took such care to safeguard the Fed’s independence out of concern that presidents’ short-term political interests can conflict with the national interest. A president facing an election will have every incentive to stimulate the economy with interest rate cuts even though this will lead to inflation after the election. This is no idle concern: President Nixon pressured Federal Reserve Chairman Arthur Burns to keep interest rates low. The result was the beginning of a long inflationary period in the 1970s. Paul Volcker recounts in his memoirs that during the Reagan administration, White House Chief of Staff Howard Baker instructed Volcker not to raise interest rates before the election—in front of the president. Volcker was not planning on any interest rates hikes at the time, but was nonetheless appalled at the instruction. Academic studies confirm that countries with high levels of central bank independence experience lower levels of inflation.

Given the harm that Trump has already done to the economy with the power to set tariffs, it is scary to imagine the damage he could do if given the power to control the Federal Reserve as well.

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SO WHAT DOES A CASE involving the National Labor Relations Board and the Merit System Protection Board have to do with Federal Reserve independence? At issue in that case is whether the president has the authority to remove members of independent agencies without cause.

Trump has attempted to fire commissioners appointed by Democratic presidents on both of these boards without cause despite a 1935 Supreme Court case holding that the president did not have the authority to remove members of the Federal Trade Commission without evidence of inefficiency, neglect of duty, or malfeasance in office. (Congress wrote those requirements into the Federal Trade Commission Act and has written similar requirements into the acts creating the NLRB, the MSPB, and the Fed.) In Humphrey’s Executor v. United States, the Supreme Court explained that while the president generally has the authority to remove executive officers at will, the president does not have the authority to remove members of boards that have “quasi-legislative” and “quasi-judicial” powers given to it by Congress.

In recent years, however, many conservative legal scholars have argued that Humphrey’s Executor is unconstitutional. Proponents of the unitary executive theory assert that the Constitution places all executive functions in the president, who therefore has complete authority over all executive branch agencies—including the so-called independent agencies. At least two justices (Clarence Thomas and Neil Gorsuch) are on the record in a concurring opinion in Seila Law LLC v. CFPB (2020) with the view that Humphrey’s Executor should be overruled. While the other justices in the majority did not go as far as Thomas and Gorsuch, they did not need to overrule Humphrey’s Executor—they simply held that it did not apply to single-member agencies such as the Consumer Financial Protection Bureau. In discussing Humphrey’s Executor, however, the majority opinion in Seila cast doubt on the very premise of the decision—that the Federal Trade Commission did not exercise executive power, noting “the Court’s conclusion that the FTC did not exercise executive power has not withstood the test of time.” Accordingly, a decision to overrule Humphrey’s Executor and uphold Trump’s firings is a distinct possibility.

There are many reasons why it would be a mistake to overrule Humphrey’s Executor. The text of the Constitution hardly supports the notion that Congress had no say over the running of executive agencies. Article 1, Section 8 expressly gives Congress the power to make laws “necessary and proper for carrying into Execution . . . all other powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.” This certainly seems to mean that Congress can make laws that govern the executive branch.

More fundamentally, this model of multi-member bodies has been in existence since at least 1887 (and there was a multi-member body called the Sinking Fund even earlier in our history). This is almost half of our history as a constitutional republic. Humphrey’s Executor itself is almost ninety years old. Congress has relied on this history in giving authority to federal agencies, and an abrupt decision to reverse the case would retroactively change the balance that Congress established in setting up many different independent bodies.

All that said, if the Supreme Court does embrace the unitary executive theory and overrule Humphrey’s Executor, it is hard to see how the Federal Reserve maintains its independence. Powell has said he thinks that the outcome the case would not affect the status of the Fed, and the question would certainly be contested in the courts, but it seems likely that if the president has the power to fire members of independent boards and commissions, then the Fed chair and members of the Fed Board of Governors could also be fired by the president. The fact that there are members of the Federal Open Market Committee not selected by the president (the Reserve Bank presidents) could also be challenged as inconsistent with the president’s authority over the executive branch.

It may be, however, that the implications of overruling Humphrey’s Executor to the independence of the Federal Reserve might itself give the Supreme Court pause. It is hard to come up with a rational basis to justify keeping the Federal Reserve independent if Humphrey’s Executor is overruled. Even today’s rightward-tilted Court might balk at deciding a case that leads to presidential control over the Federal Reserve, and thus grudgingly keep Humphrey’s Executor as law of the land.

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Charles Blanchard is senior counsel at Arnold & Porter. He previously served as general counsel of the Army (1999–2001) and the Air Force (2009–2013). Substack: Notes for the Perplexed.