Steve Forbes, CEO of Forbes Media, provides a detailed analysis of the Fed’s ongoing efforts to engineer a soft landing and discusses the 2024 election on “Cavuto: Coast to Coast.”
Former President Trump’s Vice Presidential Nominee Senator J.D. VanceU.S. Sen. John McCain, R-Ohio, said Sunday he supports Trump’s call for presidents to have a say in the Federal Reserve’s policymaking process, including decisions on whether to raise interest rates, saying those decisions should be “political decisions.”
Vance made his comments in an interview with CNN’s “State of the Union” after Trump said Thursday he thought the president “should have at least $100 million.” [a] “Say there” when the Fed takes monetary policy steps.
“I agree with him,” Vance said of Trump. “This should be a fundamentally political decision. Whether we agree or disagree, America’s elected leaders should have a say in the most important decisions facing our country.”
Vance added that it would be a “huge change” to move away from the long-held position that Federal Reserve Monetary Policy Decisions should be made independent of the political influences of elected officials.
Trump Suggests Presidents Should Have a Say in Fed Policy
Senator J.D. Vance said he agrees with his running mate, former President Trump, that the president should have a say in the Federal Reserve’s monetary policy decisions. (Emily Elconen/Bloomberg via Getty Images)
He stressed that in his and Trump’s view, the president should not “direct” monetary policy, adding: “To be clear, President Trump “What he is saying, I think, is something that is really important and really profound, which is that the political leadership in this country should have a greater say in the monetary policy of this country.”
“If the American people don’t like our interest rate policy, they should elect someone else to change it,” Vance said. “Nothing should be above the democratic debate in this country when it comes to the big issues facing the United States.”
Trump spoke during a news conference held on Thursday at his Mar-a-Lago resort. Residence in Florida “The president should have at least,” he said. [a] “I say there,” he added, “I think in my case, I’ve made a lot of money, I’ve been very successful, and I think I have a better instinct than many people who would be at the Fed or the chairman of the board.”
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“Whether you agree or disagree, we must have America’s elected leaders involved in the most important decisions facing our country,” Senator Vance said. (Chip Somodevilla/Getty Images)
While in office, Trump frequently attacked the Fed’s policy-making decisions and the central bank’s leadership. The former president also criticized Chairman Jerome Powell – who appointed him to the post in 2017 – for raising interest rates, including threatening to fire him and berating him as “stupid.”
Trump criticized the Fed in his remarks on Thursday for “making a lot of mistakes” and described Powell as “a little bit early and a little bit late” in moving interest rates.
The Fed makes monetary policy decisions independently of input from politicians to ensure that policy decisions are made to support the central bank’s dual mandate of promoting price stability and full employment without taking short-term political considerations into account.
Fed keeps interest rates steady at 23-year high, but opens door to rate cuts
Federal Reserve Chairman Jerome Powell said last month that there is strong support for the continued independence of the Fed in Congress. (Kevin Deitch/Getty Images)
Powell has repeatedly stressed the importance of the Fed’s political independence and said criticism from Trump or other politicians does not affect the central bank. Monetary policy decisions.
“Price stability is the foundation of a healthy economy and provides the public with incalculable benefits over time,” Powell said at a conference in January 2023. “But restoring price stability when inflation is high may require unpopular measures in the near term, such as raising interest rates to slow the economy. The absence of direct political control over our decisions allows us to take these necessary measures without considering short-term political factors.”
“I think support for Fed independence is very high, and it’s really important in Congress, in both parties,” he said at a conference in July.
Fed’s Goolsbee says central bank will ‘fix’ US economy if it deteriorates
Former President Trump said that if elected he would allow Federal Reserve Chairman Jerome Powell to complete the rest of his term but would not reappoint him. (Olivier Doulier/Bloomberg via Getty Images)
Powell’s second term as Fed chairman ends in May 2026, and his position on the Fed’s board continues through 2028.
Trump said he would allow Powell to complete his term as Fed chairman if he wins in November, but added that he would not reappoint Powell for a third term.
“I think he’s a politician,” Trump said in an interview in February. Maria Bartiromo of FOX Business“I think he would do something to help the Democrats, I think, if he lowered interest rates.”
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Vice President Kamala HarrisHillary Clinton, who officially became the Democratic presidential nominee earlier this month after President Biden dropped out of the race in July, said Saturday that she disagreed with Trump’s view that the president should be
“The Fed is an independent entity and as chairman I will never interfere in the decisions that the Fed makes,” Harris told reporters in Arizona.
Fox Business’ Megan Heaney and Reuters contributed to this report.