The Journal – Episode Summary: "Who Will Be the Next Fed Chair? Maybe Kevin"

Released: July 10, 2025

Introduction

In this episode of The Journal, hosted by Jessica Mendoza and Nick Timiros, the discussion centers on the ongoing quest to replace Jerome Powell as the Chair of the Federal Reserve. The episode delves into former President Donald Trump's persistent dissatisfaction with Powell, the characteristics sought in a successor, and the leading candidates vying for the top Fed position.

Trump's Frustration with Jerome Powell

The episode opens with a nod to Donald Trump's penchant for public showdowns, likening his desire to replace Powell to his "You're fired" catchphrase from The Apprentice. Jessica Mendoza sets the stage:

Jessica Mendoza [00:15]: "On his reality series, the Apprentice, President Trump made a big show of firing people. It's a philosophy he's brought into his presidency, firing agency heads and employees across the federal government. And there's one person Trump has made really clear. He wants to get rid of Jerome Powell, the chair of the Federal Reserve."

Nick Timiros elaborates on the root of Trump's dissatisfaction:

Nick Timiros [00:48]: "The Fed has paused interest rate cuts that they began last year because they're worried that inflation is going to kick back up here due to the president's tariffs. Trump wants low interest rates, and he's going to do whatever he can do to get what he thinks is necessary there."

The Search for a Replacement: Desired Traits and Challenges

Trump's approach to finding a new Fed Chair mirrors his reality TV strategy, focusing on candidates who are both loyal and media-friendly. Mendoza and Timiros discuss the unique nature of this transition:

Nick Timiros [01:58]: "This is going to be the most unusual Fed transition since the late 1970s... It feels like we're watching reality TV."

Trump's criteria are clear: the successor must be controllable, market-credible, and able to align with his pro-growth agenda. The White House emphasizes the need for candidates who can support the administration's objectives:

White House Spokesman [07:05]: "Federal Reserve's monetary policy needs to complement the administration's pro growth agenda... continue to nominate the most qualified individuals who can best serve the American people."

Candidate Spotlight: Kevin Hassett

Kevin Hassett emerges as a frontrunner, with a deep history in Republican economic circles and a close working relationship with Trump. His tenure as Chair of the Council of Economic Advisers under Trump is highlighted, showcasing his initial defense of Fed independence:

Kevin Hassett [09:09]: "I keep a list of the people who voted for me and against me on my wall... That's the attitude that I take to the CEA because if you read."

However, Hassett's stance evolves, aligning more closely with Trump's criticisms of Powell:

Kevin Hassett [11:02]: "Jay Powell is the person who cut rates right ahead of the election to help Kamala Harris... policy action suggests that he's been basically doing whatever it is that Elizabeth Warren wants him to do."

This shift indicates Hassett's willingness to challenge the Fed's autonomy, making him a strong candidate in Trump's eyes.

Candidate Spotlight: Kevin Warsh

Kevin Warsh is presented as the more traditional pick, with his background as a Fed governor during the 2008 financial crisis. Initially a loyal lieutenant to then-Fed Chair Ben Bernanke, Warsh became a vocal critic of the Fed's policies post-2010:

Kevin Warsh [12:55]: "If the Fed had acted as leisurely in the 2008 crisis and the 2020 crisis as they're acting now... I must say I'm a little bit puzzled to understand why they've been slow..."

Warsh's history as a free trader presents challenges, especially considering Trump's skepticism of his past positions on tariffs and economic policies. Despite attempts to realign his stance to support Trump's economic philosophy, Warsh lacks the direct access to the White House that Hassett enjoys.

Potential Third Candidate: Scott Besant

Scott Besant, the current Treasury Secretary, enters the conversation as a possible contender. His close advisory role and interactions with Trump position him as a potential successor, though legal and practical constraints make dual roles untenable:

Nick Timiros [15:09]: "Scott Besant is certainly going to be a sounding board for the President throughout all of this... Trump is thinking and vocalizing his desire for Scott Besant to be his Fed chair."

However, Mendoza raises the improbability of Besant holding both the Treasury and Fed Chair positions simultaneously, highlighting legal restrictions and the importance of Fed independence:

Jessica Mendoza [15:09]: "Besant is already. He has a job. He's Treasury Secretary. Could he conceivably be both? Is that a thing?"

Nick Timiros [16:22]: "No. The law that creates the Fed says you can't have another job when you're working at the Fed... it would ruin the idea that the central bank is independent."

Challenges to Trump's Influence on the Fed

Despite Trump's efforts to find a compliant Fed Chair, the structure and tradition of the Federal Reserve present significant barriers. Timiros emphasizes that monetary policy decisions require consensus among a 12-member committee, limiting the influence of a single chair:

Nick Timiros [17:31]: "The Fed chair doesn't get to decide a loan on monetary policy. Interest rates are set by a committee of 12 people, and the Fed chair has one vote."

Moreover, the Fed's tradition of unanimous or near-unanimous decisions ensures that even a chair aligned with the President may face resistance from other members, preserving the institution's independence.

Conclusion: An Unpredictable Path Forward

As the search intensifies, Mendoza and Timiros acknowledge the unpredictable and dramatic nature of this transition:

Nick Timiros [19:08]: "This is going to be like any reality show. Lots of plot twists, very fluid, very hard to predict."

The episode concludes with anticipation of continued developments and the realization that replacing Jerome Powell is more complex than a straightforward nomination, given the Federal Reserve's established protocols and the intricate balance between presidential influence and institutional autonomy.

Notable Quotes

• Donald Trump [00:15]: "You're fired. You're fired. You're fired. You're fired. You're all fired. You're fired. Go."

• Nick Timiros [01:25]: "Trump wants somebody who he can control, who will be loyal to him, and he wants somebody who looks good on tv."

• Kevin Hassett [11:02]: "Jay Powell is the person who cut rates right ahead of the election to help Kamala Harris... he's been basically doing whatever it is that Elizabeth Warren wants him to do."

• Kevin Warsh [12:55]: "I must say I'm a little bit puzzled to understand why they've been slow..."

Final Thoughts

This episode of The Journal provides an in-depth exploration of the political and economic maneuvering behind the potential replacement of the Federal Reserve Chair. Through expert analysis and firsthand accounts, listeners gain a comprehensive understanding of the complexities involved in this high-stakes transition.