Trump vs Cook: Questioning the independence of the Fed. Amza Togore (Trinity College)

On January 21, 2026, the Supreme Court of the United States convened in Washington, D.C., for oral arguments in the high-stakes case of Trump v. Cook (No. 25A312). The proceedings, which began at 10:03 a.m. before Chief Justice Roberts and the Associate Justices, center on President Donald J. Trump's emergency application to stay a preliminary injunction that reinstated Lisa D. Cook to the Board of Governors of the Federal Reserve System. The central legal battle involves whether the President has the authority to remove a Federal Reserve governor for "cause" based on alleged misconduct that occurred before her tenure, specifically, claims of "deceit or gross negligence" regarding conflicting mortgage applications submitted in 2021. Solicitor General D. John Sauer represented the Applicants (the President), while Paul D. Clement argued on behalf of Respondent Lisa Cook.

Amza Togore at the Supreme Court

The core of the dispute rests on the definition of "cause" and the procedural requirements for removal. Solicitor General Sauer argued that "cause" is a broad term encompassing any conduct, including pre-office actions, that impugns an official's "fitness, ability, or competence," and contended that the President's determination of such cause should be largely unreviewable by the courts. Conversely, Paul Clement maintained that "for cause" removal necessitates a more stringent standard, traditionally interpreted as "inefficiency, neglect of duty, or malfeasance in office" (INM), and must be accompanied by formal notice and a hearing. Members of the Court expressed varying concerns: Justice Sotomayor and Justice Jackson pushed back on the President’s unilateral authority, questioning the lack of due process and the "unprecedented" nature of removing a Federal Reserve officer for the first time in 112 years. Meanwhile, Justice Alito and others probed whether the "cause" must strictly relate to in-office conduct or if a "property interest" in the position warrants constitutional protection.

From the perspective of an economics student, the legal hair-splitting over "cause" belies a much more volatile reality: the fragility of central bank independence. In macroeconomics, the credibility of the Federal Reserve is our most vital intangible asset; it anchors inflation expectations and ensures that monetary policy is driven by data rather than political cycles. If a President can reach back into a governor’s personal history to trigger a removal via social media, it creates a "revocable independence" that the markets will inevitably price in as a risk premium. As noted during the hearing, amicus briefs from leading economists warn that such a removal could rattle global markets and potentially trigger a recession. The "unprecedented" nature of this executive action, breaking over a century of stability, threatens to transform the Fed from a technocratic shield into a political prize. For those of us studying market behavior, the danger isn't just in the removal of one governor, but in the signal it sends: that the firewall between the Roosevelt Room and the Eccles Building has been breached, leaving the global economy vulnerable to the whims of the electoral calendar.

Furthermore, as a young student with interest in international economic policy, the Trump v. Cook hearing is more than just a domestic legal squabble; it is a profound lesson in the institutional architecture that underpins the global financial system. From our perspective, the Federal Reserve isn't just an American central bank; it is the world's de facto "lender of last resort," and its stability is the linchpin of global trade and currency valuations. Seeing a removal predicated on personal conduct from years prior, rather than policy failure or current professional ethics, is deeply unsettling. It suggests that the "rules-based order" we study in textbooks might be more susceptible to domestic political maneuvering than we assumed. For those of us looking to build careers in international policy, this case highlights a critical vulnerability: if the independence of the world's most powerful economic regulator can be challenged over a mortgage application error, then the predictability required for international cooperation is at risk.

I believe the Court will most likely decide in favor of Governor Cook. The "for cause" removal standard was designed by Congress as a deliberate compromise to insulate the Federal Reserve from political pressures. Allowing a President to bypass due process, without a formal hearing or notice, to remove a governor for conduct occurring years before her appointment would set a dangerous precedent that effectively transforms independent regulatory roles into at-will executive positions. Protecting Governor Cook’s seat is not just about her individual case but about upholding the procedural safeguards that maintain the public’s and the global market's confidence in the Federal Reserve's essential independence.