House Democrats are pushing for a congressional inquiry into the criminal investigation surrounding Federal Reserve Chairman Jerome Powell. Led by Rep. Jamie Raskin of Maryland, the Democrats are pressing Chairman Jim Jordan to initiate a probe. They describe the ongoing investigation as a “sham” orchestrated by the Trump administration to exert pressure on Powell.
The Democrats’ letter highlights Powell’s statement where he addressed the investigation. It claims that this inquiry is not based on legitimate economic concerns but rather on President Trump’s desire to control interest rates according to his preferences. Raskin stated, “That investigation is a flagrant attempt by the President to bully and intimidate the Board.” This sentiment echoes the party’s stance on the importance of the Federal Reserve’s independence.
The inquiry’s backdrop is a growing concern among party members who view the Department of Justice’s actions as a threat to the central bank’s autonomy. The Democrats have requested that Jordan hold public hearings and consider subpoenaing Attorney General Pam Bondi and other DOJ officials for testimony. This reflects the seriousness with which they approach the potential implications of the investigation.
Heading the investigation is U.S. Attorney Jeanine Pirro for the District of Columbia, who has noted a lack of cooperation from Powell’s office. Pirro emphasized the importance of her office’s inquiries regarding cost overruns associated with the Federal Reserve’s renovation project. In her words, the use of legal means was necessary “which is not a threat.” She underscored that decisions are made based on merit and that “no one is above the law.”
This situation has added to tensions on Capitol Hill. While Democrats uniformly express discontent over the investigation, some Republicans also share concerns. House Financial Services Committee Chairman French Hill remarked on the distraction this probe could create during a turbulent economic period, stating that “pursuing criminal charges relating to his testimony… creates an unnecessary distraction.” His view illustrates a level of bipartisan apprehension regarding the potential fallout from the investigation.
Powell himself has stated that the DOJ’s actions suggest a forthcoming criminal indictment linked to his congressional testimony. However, he contends that the motivation behind the investigation is more about the autonomy of the Federal Reserve amid persistent pressure from President Trump for faster interest rate reductions. Trump has openly criticized Powell multiple times for not acting swiftly enough in this regard.
Despite Trump’s denials of involvement in initiating the probe, he did express his discontent with Powell’s performance, stating in an interview that “he’s certainly not very good at the Fed, and he’s not very good at building buildings.” His comments underscore the contentious relationship between Trump and Powell, which has been a source of friction in economic policy discussions.
Overall, this inquiry marks a significant moment in the ongoing struggle between political influence and the independence of financial institutions. How this situation unfolds could have implications not just for Powell but for the Federal Reserve’s role in economic management moving forward.
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