How Bessent Made the Case to Trump Against Firing Fed Chair Powell Some Republicans have laid the groundwork to oust the central-bank chief, but the Treasury secretary cited practical obstacles and economic hazards By Brian Schwartz and Nick Timiraos July 19, 2025 3:43 pm ET Treasury Secretary Scott Bessent, center, with President Trump and White House chief of staff Susie Wiles in April. Treasury Secretary Scott Bessent in recent days privately laid out his case to President Trump for why he believed Trump shouldn’t try to oust Federal Reserve Chair Jerome Powell, people familiar with the matter said. Bessent’s reasons for avoiding a messy dispute over Powell’s final 10 months as Fed chair focused on a few themes: the possible effects on the economy and markets, the prospect that the Fed is already moving toward cutting interest rates later this year, and the likely political and legal obstacles that such a move would face, these people said. Bessent said firing Powell was unnecessary because the economy is doing well and markets have responded positively to the president’s policies, according to one of the people familiar with the matter. Bessent also reminded Trump that Fed officials have signaled they could cut rates twice before year’s end, this person said. The possibility of the president attempting to fire Powell has been in the air for months, but it exploded into public view again this past week. Trump has repeatedly complained that the Fed needs to cut rates to lower federal debt expenses, and a senior White House official on Wednesday said the president had indicated to GOP lawmakers at a recent meeting he could soon move to fire Powell. Later on Wednesday, Trump told reporters that he wasn’t planning to do so. The episode briefly churned up financial markets. Many investors think attempting to replace central-bank officials over policy disputes could steadily erode the central bank’s independence, or its authority to take unpopular steps when necessary to maintain low inflation. Federal Reserve Chair Jerome Powell last month. The Wall Street Journal reported in April that Bessent and Commerce Secretary Howard Lutnick advised Trump against attempting to oust Powell when the president publicly mused about the Fed leader’s “termination.” In this latest episode, Bessent told Trump that if he fired Powell before the conclusion of his term, the Fed chair could sue and that lawsuit might drag into the spring—coinciding with the end of Powell’s term anyway. Some advisers in the president’s orbit have acknowledged that even without a probable court challenge from Powell, any attempted removal could create a prolonged leadership vacuum—because there is no guarantee the Senate, typically away from Washington in August, would quickly confirm a replacement. Firing Powell over the objections of several GOP senators could frustrate the confirmation process for any successor. Under current law, the Fed’s vice chair serves in the chair’s absence. Vice Chair Philip Jefferson is a Biden appointee and Powell ally. These advisers have conceded that financial-market and practical obstacles to pushing out Powell risk a lose-lose scenario for Trump: The administration owns the cost of adverse market reactions without the benefit of gaining immediate influence over monetary policy. Beyond the immediate obstacles, Bessent also told the president he is already well on his way to putting his stamp on the Fed. Fed governor Adriana Kugler’s term ends in January. Powell’s term as chair ends in May. That will give Trump one or two vacancies to fill early next year. A White House spokesman said Trump “will nominate the best possible candidate to restore competence, confidence and accountability at the Federal Reserve.” Trump’s renewed consideration of firing Powell coincided with administration officials laying out a new line of attack by challenging his oversight of the renovation of two historic buildings that will serve as its headquarters in Washington. The project has seen large cost overruns that the Fed has blamed on rising material costs and unanticipated construction challenges. President Trump has denied he is considering firing Federal Reserve Chair Jerome Powell, but his administration has ramped up its criticism of the central bank’s $2.5 billion office renovation. WSJ’s Nick Timiraos explains why. Photo Illustration: Ryan Trefes A handful of Powell’s Senate critics have called on him to resign, but at least three Republicans on the Senate Banking Committee have said they don’t believe the Fed chair can or should be dismissed. Senate Majority Leader John Thune raised similar concerns on Wednesday, telling Fox News, “I think the markets want an independent Federal Reserve.” Bessent’s cautious approach marks a contrast to other administration officials who have entertained more aggressive tactics. Trump told reporters on Tuesday he feels Bessent is “soothing.” White House budget director Russell Vought has been leading the campaign to pressure Powell over Fed construction cost overruns, potentially laying groundwork for a “for cause” removal that could sidestep legal protections. As part of that effort, Trump recently installed three advisers, including one who works directly for Vought, on a local planning commission. That commission signed off on the Fed’s design plans in 2021. Those advisers and Vought have threatened to seek a more comprehensive audit of the Fed’s construction and financial decisions. Russell Vought is leading the pressure campaign on the Fed’s construction costs. Those advisers also asked to visit the Fed’s construction site, and the Fed offered a Friday-evening tour, James Blair, a deputy chief of staff, told reporters on Friday afternoon. He said the time didn’t work and asked to reschedule for next week. Vought has been coy about whether the pressure campaign could serve as a predicate for attempting a for-cause removal of the Fed chair that sidesteps a recent Supreme Court order. Bessent said this past week the Fed chair succession process is already under way. Senior economic adviser Kevin Hassett is seen by many in Trump’s orbit as the current front-runner. White House economic adviser Kevin Hassett is considered a leading candidate to succeed the Fed chair. Trump has been considering announcing his pick to replace Powell by September, according to previous reporting by the Journal. But declaring Powell’s replacement sooner could satisfy the president’s desire to more immediately influence rate policy without triggering potential chaos from attempting to remove Powell. “There are a lot of great candidates and we will see how rapidly it progresses. It’s President Trump’s decision and it will move at his speed,” Bessent said this past week in an interview on Bloomberg Television. Some advisers have indicated in recent days that they could consider a broader range of candidates, including some whose names haven’t surfaced publicly, according to some of the people. The hope is that a greater number of surrogates will take to the airwaves and publicly pressure the Fed to lower rates.
Bessent is literally the only sane economics guy. He’s the reason the markets aren’t sub 2000 right now. And even he has to say dumb things to appease his boss.
High US interest rates are stalling growth, the FED is backwards. Hey Vance, just crash oil prices and that will crash inflation forcing a rate cut. Trump's veins are swelling up his brain, he decide anymore.