Fed chair gets backup from Congress amid Trump onslaught


A review by CNN of Powell’s public calendars for the first 16 months of his tenure as chairman shows he’s held more than 100 meetings with individual lawmakers, earning a reputation for being unusually accessible. He’s also often held phone calls and attended the occasional dinner, including one hosted by Republican Sen. Lamar Alexander of Tennessee last November with a group of 10 bipartisan lawmakers, including Sens. Richard Shelby of Alabama, Sherrod Brown of Ohio, Michael Bennet of Colorado and Jeanne Shaheen of New Hampshire.

On February 13, he also met with the Republican members of the Senate Banking Committee for 45 minutes, and then held individual one-on-one meetings for the rest of the afternoon with Idaho Sen. Mike Crapo, the chairman of the panel, and Sens. Tina Smith of Minnesota and Martha McSally of Arizona, who also sit on the committee.

That investment has paid off as congressional leaders from both parties rally behind the Trump appointee, defending him as well as the institution he represents from the kind of scorn Trump has dumped on other key hires — most notably former Attorney General Jeff Sessions.

“I think the chairman of the Fed should be kept in his position and I support him as the leader of the Fed,” Republican Sen. Mitt Romney of Utah, who met with the chairman on May 7, told CNN.

Powell headed to Capitol Hill for the first of back-to-back hearings in the House and Senate starting on Wednesday. He first appeared before the House Financial Services Committee, and then will face the Senate Banking Committee on Thursday.

On Wednesday, Democratic Rep. David Scott of Georgia told Powell to “stay strong.”

“Have no fear, the President can’t fire you,” Scott says, adding that both “Republicans and Democrats have your back.”

For months, the President has continued to use the Fed as his economic scapegoat, laying blame on Powell for any softening in the US economy — and routinely suggesting it would be doing even better if the Fed hadn’t raised interest rates last December. That move spooked investors, contributing a market selloff in the middle of the Christmas holiday, when Trump was also escalating his trade war with China and as the federal government was partially shutting down.
Powell had dinner at the White House in February, too, and has now spoken to the President by phone three months in a row, most recently in May for five minutes, according to his public calendar. But the pace of Trump’s attacks hasn’t let up.
“Our Federal Reserve doesn’t have a clue!” Trump tweeted last week. He’s also threatened that he has the power to demote and even fire Powell.

“If I was Jay Powell, I’d be trying to enlist members of Congress on the side of the Fed and on the side of the law,” said Alan Blinder, an economics professor at Princeton University who served as Fed vice chairman under President Bill Clinton. “If he gets into a knife fight with the White House he wants some members on his side.”

A senior House aide told CNN that Powell has been a “pretty open chair” compared to his immediate predecessors, Janet Yellen and Ben Bernanke, and has “made a lot of effort to engage” in the Hill.

“I don’t see quite the level of concern and frustration that the President seems to express in his comments and tweets,” said the senior aide. “Most see the economy doing fantastic and I don’t think this is top of mind as it seems to be for the President.”

In interviews, senators shrugged off Trump’s persistent criticism of Powell, saying he has the right to voice his views and pointing to the fact that his calls for lower rates follows a long-held preference by both Democratic and Republican presidents alike.

“All presidents whether it’s Republican or Democrat, if you look back in history, they all like low interest rates because they help fuel the economy,” said Shelby. “The Fed overall, I believe, is doing a good job. They might not please me day to day, but their independence is important.”

Pennsylvania Republican Sen. Pat Toomey echoed that sentiment.

“It would be a big mistake to attempt to demote or fire,” said Toomey, who met with Powell on May 8 for a 45-minute breakfast. That day, Powell also held a short meeting with Tennessee Republican Sen. Marsha Blackburn and attended a dinner hosted by Senate Minority Leader Chuck Schumer at the Jefferson Hotel.

Republican Sen. Kevin Cramer of North Dakota, a newcomer to the Senate panel, offered a rosy report card of Powell saying he has conducted himself with “great integrity” and “good intellectual honesty.”

“The President is the President and he gets to have his opinions, and if he didn’t express them he wouldn’t be President,” said Cramer.

The Fed, which was created by Congress, has made it a practice to stay out of the fray of political attacks. Powell has sought to distance himself from Trump’s criticism, saying the Fed doesn’t consider politics in its policy decisions and he has no plans to leave before his term expires in 2022.

“Everybody likes to beat on the Federal Reserve, because they can’t beat back, they can’t fight back,” said Republican Sen. John Cornyn of Texas.

The law makes clear it would be unlawful for the President to fire Powell without cause. What’s murkier is whether Trump could demote Powell from his role — a possibility that Trump refused last month to rule out, though senators said they weren’t sure he had the power to do it.

“I don’t know if he does or he doesn’t. I just assume he shouldn’t,” said Cramer. “At the end of the term, you can make a change if you like, but that’s why there are terms.”



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