Defending Trump’s Dismissal of Cook? Besant: The Fed Should Be Independent but Has Repeatedly Made Mistakes

As the conflict between U.S. President Trump and the Federal Reserve continues to escalate, economists have warned that threats to the Fed’s independence could have severe consequences for the U.S. and even the global economy. In response, U.S. Treasury Secretary Besant has come to its defense.

On Monday local time, U.S. Treasury Secretary Besant stated that the Federal Reserve is independent and should remain independent. However, he noted that the Fed has "made many mistakes" and defended President Trump’s authority to dismiss Federal Reserve Governor Lisa Cook over allegations of mortgage fraud.

For months, Trump has criticized the Federal Reserve and its Chair Powell for not lowering interest rates. Recently, he has also targeted Powell, accusing him of overseeing an expensive renovation of the Fed’s Washington headquarters.

When asked whether the administration’s attempt to remove Cook seemed like an effort to give Trump an opportunity to appoint a majority of the Federal Reserve Board, Besant replied, “Well, or is it that you have to do for the Fed what they should have done themselves?”

Cook and her supporters believe the fraud allegations are a pretext Trump created to remove her, allowing him to appoint an ally to the Fed to advance his policy agenda. Cook is currently suing Trump and the Federal Reserve, arguing that Trump does not have the authority to dismiss her.

The Trump administration claims that Cook described separate properties in Michigan and Georgia as her primary residence in a 2021 mortgage application, which may have qualified her for preferential rates. Cook has stated that even if the allegations are true, they should not justify her removal, as these actions occurred before she was confirmed by the Senate and took office in 2022.

“I am very surprised that the Federal Reserve did not conduct an independent review,” Besant said. “She did not say she didn’t do it. She just said the president can’t fire her. That’s a big difference.”