Podcast Summary: Bulwark Takes

Episode: BREAKING: DOJ Threatens Fed Chair With Criminal Charges

Date: January 12, 2026
Host: Sam Stein
Guests: Catherine Rampell, JBL

Overview

On this urgent, Sunday evening edition of "Bulwark Takes," the panel responds to breaking news: the Justice Department (DOJ) is reportedly opening a criminal investigation into Federal Reserve Chair Jay Powell, alleging he lied to Congress regarding the costs of renovating Federal Reserve headquarters. The episode explores the significance of this unprecedented move, discusses the politicization of the Fed, and the broader implications for American governance and financial markets under the Trump administration. Key topics include historical context, the independence of the Fed, possible Senate and market responses, and what comes next for the institution.

Key Discussion Points & Insights

1. The News: DOJ Threatens Fed Chair Jay Powell (01:30–03:00)

• DOJ is investigating Powell for allegedly lying in congressional testimony about the cost of Federal Reserve renovations.
• The move is widely seen by the panel as politically motivated, given the long-running tension between Trump and Powell regarding Federal Reserve policy.

Quote:
"It's huge... Powell is being punished not for whatever crime he's alleged... but for the worst crime of not doing exactly what Trump wants."
— Catherine Rampell (02:26)

• Trump, believing the Fed should obey his policy demands, is accused of disregarding the need for central bank independence.
• Powell’s term is set to end soon; panelists question why the administration would undertake this now, speculating it won’t achieve the desired policy outcomes but will destabilize markets.

2. Erosion of Norms & Political Context (03:00–07:00)

• The panel discusses how the incident is both part of and different from Trump's broader pattern of distracting the public from scandals with extraordinary executive actions.

Quote:
"I mean, look, he invaded Venezuela to distract people from all the stuff about his friendship with the notorious pedophile ring leader Jeffrey Epstein... and now he's attempting to jail the head of the central bank to distract them from that. I mean, this is just what he does."
— JBL (04:27)

• The DOJ’s move is met with resignation and little surprise, illustrating how political norms around government agencies like the DOJ have collapsed.

3. Hypocrisy Around Renovations (06:11–07:30)

• The panel highlights the irony of Trump targeting Powell for alleged "cost overruns" on renovations, given Trump’s own notorious reputation for overblown renovations as a builder and president.

Quote:
"The only thing that Trump can come up with for, like, what this guy must have done wrong is something related to renovation."
— Catherine Rampell (07:19)

4. Powell’s Video Response (08:11–09:32)

• Powell issues a rare, direct public statement:
  • Asserts respect for rule of law
  • Warns the indictment threat is about monetary policy independence, not building costs or testimony
  • Views the action as administration applying pressure to politicize monetary policy

Quote:
"This new threat is not about my testimony… Those are pretexts. The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment... rather than following the preferences of the President."
— Jay Powell (08:11–09:32)

• Panel lauds Powell for not acquiescing, breaking with DC traditions of quiet institutionalism.

5. Historical Context: Volcker vs. Burns (10:36–12:27)

• The episode draws on Fed history:
  • Paul Volcker is praised for standing up to political pressure and fighting inflation at great personal and political cost.
  • Arthur Burns, by contrast, is infamous for yielding to White House pressure, leading to stagflation.
  • Panel frames Powell’s stand as an effort to be remembered as a statesman, not a political pawn.

Quote:
"Everyone wants to be Paul Volcker. They want to be the statesman who takes the tough stand because they know it's the right thing in the long run, even if it makes them the most hated person on earth."
— Catherine Rampell (12:27)

6. The Senate’s Role and Thom Tillis’ Statement (20:15–21:29)

• GOP Senator Thom Tillis vows to oppose any Fed nominee until the matter is settled, regardless of the actual allegations.
• This creates practical hurdles in the Senate Banking Committee, potentially requiring a 60-vote threshold for confirmation.

Quote:
"I will oppose the confirmation of any nominee for the Fed, including the upcoming Fed Chair vacancy, until this legal matter is fully resolved."
— Quoting Thom Tillis (21:29)

7. How the Markets and the Party React (23:20–29:56)

• Discussion on whether Republicans will resist a "hack" nominee for Fed Chair; historical examples where the party shut down Trump’s worst picks.

• Market reaction is seen as a key variable: if markets panic, resistance strengthens; if they are placid, the crisis may fade.

• JBL speculates that tech and real estate sectors welcome lower rates regardless of long-term dangers, which could distort market incentives and feedback to leaders.

Quote:
"For them, ZIRP, 0 interest rate is always the best possible thing... tech guys, I think are more like real estate guys because for them access to capital is the most important thing."
— JBL (24:04)

• Catherine Rampell references international parallels where undermined central banks led to hyperinflation (Argentina, Russia, Turkey, Venezuela, Zimbabwe).

8. Supreme Court Angle and Legal Precedent (34:16–34:31)

• The panel discusses how pending Supreme Court cases about independent agency firings could affect Fed leadership in the future.
• There's widespread anxiety that these decisions could set legal precedent for firing central bankers for political reasons.

9. Prospects for Next Fed Chair (36:25–37:50)

• The likeliest replacements for Powell: Kevin Warsh and Kevin Hassett, both seen as more politicized options.
• Speculative odds even include improbable names like Barron Trump.

10. Institutional Resilience and Long-Term Consequences (38:15–40:44)

• Catherine Rampell notes the structure of the Fed (regional presidents appointed independently) may contain political damage.
• Nonetheless, she stresses the paramount importance of restoring credible, apolitical leadership if the Fed is ever politicized.

Quote:
"The most important thing you can do for the credibility of that institution is put in place good people who are politically independent, who take their job seriously, who are boring technocrats..."
— Catherine Rampell (40:44)

Notable Quotes & Memorable Moments

| Timestamp | Speaker | Quote | |---------------|-------------------|------------------------------------------------------------------------------------------------| | 02:26 | Catherine Rampell | "Powell is being punished not for whatever crime he's alleged... but for the worst crime of not doing exactly what Trump wants." | | 04:27 | JBL | "This is just what he does. Right?...[Trump is] attempting to jail the head of the central bank to distract them from that." | | 08:11–09:32 | Jay Powell | "No one, certainly not the chair of the Federal Reserve, is above the law. But this unprecedented action should be seen in the broader context of the administration's threats..." | | 12:27 | Catherine Rampell | "Everyone wants to be Paul Volcker. They want to be the statesman who takes the tough stand... " | | 21:29 | Thom Tillis (quoted) | "I will oppose the confirmation of any nominee for the Fed... until this legal matter is fully resolved." | | 24:04 | JBL | "All real estate people want interest rates low always...tech guys, I think are more like real estate guys..." | | 28:50 | Sam Stein (paraphrasing Jason Furman tweet) | "Other countries where you've prosecuted or threatened to prosecute central bankers: Argentina, Russia, Turkey, Venezuela, Zimbabwe." | | 40:44 | Catherine Rampell | "The most important thing you can do for the credibility of that institution is put in place good people who are politically independent, who take their job seriously, who are boring technocrats..." |

Timestamps for Important Segments

• Breaking News and Initial Reactions: 01:30–04:24
• Political Context and Pattern: 04:24–07:30
• Jay Powell’s Statement: 08:11–09:32
• Discussion on Fed Chair Independence (Volcker/Burns): 10:36–12:27
• Senate Dynamics/Thom Tillis Statement: 20:15–21:29
• Market Reaction and Tech/Real Estate Interests: 23:20–29:56
• Supreme Court, Legal Precedent, and Agency Independence: 34:16–34:31
• Prospects for Next Fed Chair: 36:25–37:50
• Resilience of the Fed and Restoration of Credibility: 38:15–40:44

Tone & Closing Thoughts

The episode is laced with urgency, frustration, and gallows humor at the endless string of norm-shattering political events. Panelists express deep concern for the institutional health of the Fed and broader US governance, but also find moments to laugh at Trumpian spectacle and the absurdity of the political moment. As the episode closes, the group underscores the gravity of the situation but encourages listeners to stay engaged and informed.