WASHINGTON (AP) — Treasury Secretary Scott Bessent says it would be 'up to the president' to decide whether to sue Kevin Warsh, Donald Trump’s nominee to lead the Federal Reserve, if he fails to lower interest rates.
During remarks at a private black-tie dinner of the Alfalfa Club on Saturday night, Trump remarked, half-jokingly, about potentially suing his newly selected Fed chair nominee should he not act on interest rate reductions. When later queried by reporters, Trump clarified his comments were meant as a joke, saying, 'It’s a roast. It was all comedy.'
This humor, however, did not sit well with many in the Senate, especially Sen. Elizabeth Warren, D-Mass., who highlighted the concerns surrounding Trump's comments in a committee hearing on Wednesday. Her queries follow a trail of unprecedented criticisms aimed at the current Fed chair, Jerome Powell, made by Trump's administration.
Trump previously nominated Powell in 2017 but turned against him after Powell raised interest rates in 2018. Since then, Trump has continually berated Powell, cultivating worries among some Senate Republicans regarding the Trump administration's approach to maintaining the Fed's long-standing independence from political influence.
Sen. Thom Tillis, a Republican from North Carolina, has publicly expressed hesitance to support Warsh's nomination until the investigation involving Powell is resolved. Without Tillis’ backing, Warsh’s confirmation could be delayed in committee.
At the Senate hearing, Warren pressed Bessent about assurances that Warsh wouldn’t face lawsuits or investigations from the Justice Department over rate cuts. Bessent repeated that such decisions were ultimately up to the president, leading to a tense exchange as Warren noted, 'That was supposed to be the softball!'
Additonally, during the ongoing discussions, other Senate Republicans voiced a lack of criminal intent concerning Powell's actions, complicating the already contentious relationship between the Trump administration and the Fed.
