The Supreme Court of the United States held a hearing on the case of Trump's dismissal of Federal Reserve Director Cook, leaning towards upholding the independence of the central bank.

On Wednesday, the Supreme Court of the United States held a hearing regarding President Trump's attempt to remove Federal Reserve Board member Cook. Several justices sent signals indicating that the Court is unlikely to support Trump's request to immediately dismiss Cook from his position, as the case has generated market attention due to concerns about the independence of the U.S. monetary policy and the boundaries of government power. As Trump attempts to strengthen control over independent institutions outside the White House, the significance of this case has increased. There have been reports that the Department of Justice is investigating Federal Reserve Chair Powell, raising new concerns about the independence of the Federal Reserve. During the oral arguments that lasted about two hours, both conservative and liberal justices showed sympathy for Cook. According to the law, a Federal Reserve Board member can only be dismissed for "good cause," often requiring evidence of misconduct. Trump cited alleged "mortgage fraud" charges when announcing Cook's dismissal, but Cook has denied them, and bank documents obtained by the media also appear to contradict the allegations. Some justices pointed out that the Court not only has the authority to reject the Trump administration's emergency application and allow the case to continue in lower courts, but also may further clarify the legal standard for "good cause" dismissal, suggesting that Trump's reasons do not meet the threshold. When Congress established the Federal Reserve, it explicitly mandated its independence to avoid short-term political pressure interfering with its statutory duties of maintaining price stability and promoting employment. However, Trump's lawyers argue that the President's decision to dismiss via social media does not require any procedures and should not be subject to judicial review. In response, conservative Justice Kavanaugh stated that if the President's decision is not subject to review, the restriction of "good cause" would become theoretical and weaken, or even destroy, the independence of the Federal Reserve. Chief Justice Roberts also expressed similar concerns. Another conservative Justice Barrett warned that a hasty ruling could have an impact on financial markets and urged the Court to proceed with caution. Liberal justices also expressed understanding for Cook's position. Justice Jackson pointed out that there is currently no evidence suggesting Cook's continued service poses an immediate threat to the public interest. The justices engaged in heated discussions surrounding what procedures Cook should be entitled to, with the Trump administration advocating for a streamlined process. The Court also discussed whether the White House's announcement of dismissal through social media is sufficiently legitimate. Some justices questioned whether dismissed officials can only defend themselves via social media without hearings or formal response mechanisms. Last October, the Supreme Court refused to allow Trump to immediately dismiss Cook and scheduled the hearing, which is seen as the government facing significant obstacles in the case. Cook's lawyers argue that she should be notified and given the opportunity to refute the allegations before being dismissed, while the Trump administration maintains that the President has the authority to determine whether the standard of "good cause" is met. It is worth noting that both Cook and Powell attended the hearing that day. Trump has long criticized the Federal Reserve for not significantly lowering interest rates, even though Powell was appointed by him in 2017. Powell's term as chair will end in May of this year, but his term as a Board member can continue until 2028; Cook, on the other hand, was appointed by former President Biden and her term extends until 2038.