Transcript
Nicole Wallace (0:00)
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Nicole Wallace (0:40)
The second Trump administration has gone to unprecedented lengths to radically transform America.
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Nicole Wallace (1:04)
Hi there, everyone. It's 4:00 in the east. Donald Trump playing with fire today when it comes to the American economy, a once strong area for him politically that now sees some of his lowest approval marks ever in areas like inflation and tariffs, as well as a majority of Americans now expressing anxiety about how much things cost. So what does a politically vulnerable wannabe autocrat do? Well, he lunges for the steering wheel with an unprecedented and likely illegal attempt to fire a member of the independent Federal Reserve Board of Governors, Lisa Cook. Here's economist Paul Krugman on the Rachel Maddow show last night sounding the alarm.
Paul Krugman (1:45)
This is a five alarm fire because it's not just about Lisa Cook. It's clearly, as I said on my substack, this is about intimidation. This is saying no, it's, it's a mess. Is not just, you know, he's, not just that he's claims he's firing Lisa Cook, although he doesn't. We're not clear that he has the right to do that. But it's a message to everybody else on the Fed's board and basically to government officials of any kind that get in our way. Don't act as an obedient minion of Donald Trump and we will ruin you. We will destroy you. If this stands, we immediately become a we become Venezuela, we become Turkey, we become a place where all of this stuff is just at the whims of the strongman in charge.
Nicole Wallace (2:35)
Now, Cook is the first black woman to serve on the board of the Federal Reserve. She was appointed by President Joe Biden and her term is not set to expire until 2038. She is one of seven governors. And if Donald Trump succeeds in removing her, he, he will have appointed a majority of the governors on the board, which would give him greater control over the country's central bank. As with many of Donald Trump's moves, there is no precedent or clear legal authority to randomly fire Fed members you don't like. But Cook isn't going out without a fight. In a statement, she writes this quote, president Trump purported to fire me for cause when no cause exists under the law and he has no authority to do so. I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022. And Cook's D.C. super lawyer, Abby Lowell, is taking that fight a step further, announcing today that they will be filing a lawsuit. In a statement, the Federal Reserve weighed in as well, saying this quote, as always, the Federal Reserve will abide by any court decision. The stage is now set for a high stakes legal showdown likely to reach all the way to the Supreme Court. But beyond these legal questions over Donald Trump's moves, experts warn in the New York Times today of this quote, Trump's intervention could compromise an institution at the heart of the economy with damaging results. The Times adding this quote, economists warn that if Trump succeeds in pressuring the Fed into cutting rates, it could lead to faster inflation in the short run and make it harder for the central bank to manage the economy in the long run as businesses, investors and consumers lose confidence that policymakers are focused on making decisions based on evidence rather than politics. Donald Trump's new backdoor effort to tighten his grip on the Federal Reserve is where we start today with some of our favorite reporters in France. White House correspondent for the New York times, author of 2024, Tyler Pager is here. Also joining us, host of the Bulwark Podcast, MSNBC political analyst Tim Miller is here and NPR financial correspondent Maria Aspen is here. Mar just baseline this for us. What is supposed to happen between a president and members of the Fed.
