WASHINGTON (AP) — President Donald Trump is spending his second term cracking down on elected and appointed officials who resist him or refuse to give in to his demands. But he may have met Fed Chairman Jerome Powell.
As the Trump administration ramps up pressure on the Fed — now including Justice Department subpoenas and threats of criminal charges — Senate Republicans have rallied around Powell to defend an independent Fed chair under attack from a president of his own party.
“I know Chairman Powell very well. If he did anything wrong, I would be shocked, I would be appalled,” said Republican Sen. John Kennedy of Louisiana, one of Trump’s most reliable allies in the Senate.
Shortly after the Justice Department subpoenaed the Fed, Powell went on the offensive, releasing a video statement accusing the administration of using “pretexts” to force the Fed to slash interest rates as Trump demanded. The 72-year-old Fed chair also relied on the Capitol Hill relationships he has built since taking office in 2018, holding multiple calls with Republican senators in the days after the video was released.
“He’s familiar with the way Congress works,” said Robert Tetlow, a former senior policy adviser at the Federal Reserve. “He goes in, pets the dog, blows the air, and has a way of making people like him, and he’s really good at it.”
For some in Congress, it’s personal
At a hearing in March 2024, Powell received an unusual greeting from a member of the Senate Banking Committee: hello from the office dog.
“Greetings from Gus,” said Sen. Thom Tillis, R-N.C. “If you have time after the hearing, you should go and see him.”
“I didn’t want to disturb his nap,” Powell said, to laughter in the hearing room.
Now Tillis, who is retiring at the end of the year, has been among Republicans rushing to defend Powell, vowing not to support any of the Trump administration’s Fed nominees until the legal cloud surrounding the chairman is lifted.
Alaska Sen. Lisa Murkowski supports Tillis’ plan to block the nominee. She was one of several Republican senators who said they spoke with Powell after his video statement.
“I think the situation with Jay Powell and the so-called investigation into overhauling their office there is reason to do nothing but intimidation, threats and coercion,” Murkowski told reporters, referring to Powell informally as “Jay.”
Murkowski and Tillis have not shied away from criticizing the Trump administration in recent months. What’s unique about Powell’s backlash is that even Trump’s reliable allies — and opponents of the Fed’s recent decisions — have flocked to the Fed chairman’s side.
“I firmly believe in the independence of the Federal Reserve,” said Sen. Dave McCormick of Pennsylvania, a member of the Senate Banking Committee. The first-term senator added that he agreed with “President Trump that Chairman Powell has been slow to cut rates,” but said he “does not believe Chairman Powell is guilty of criminal activity.”
Senate Majority Leader John Thune (R-S.D.) said the investigation “better be real” and “better be serious.”
In the House, Financial Services Chairman French Hill criticized the Justice Department investigation.
“I know Mr. Powell to be a man of integrity and deeply committed to public service,” he said. “While we have had policy differences over the years, I have found him to be forthright, candid and a man of the highest integrity.”
Decades of service in Washington
Hill also said in the statement, “He has known Chairman Powell since we worked together at the Treasury Department during the Bush administration.”
Powell, a Republican, has been a fixture in the nation’s capital for decades, where he has earned a reputation as a centrist. From 2010 to 2012, he worked at the Bipartisan Policy Center, a think tank, where he pushed congressional Republicans to reach a compromise in the budget battle with President Barack Obama.
Obama appointed Powell to the Federal Reserve Board of Governors in 2012. Trump later elevated him to the chairmanship in 2018. He was reappointed in 2022 by President Joe Biden.
Powell also built credibility with House and Senate Republicans by largely ignoring Trump’s personal attacks on Powell’s 2018 interest rate hikes during the president’s first term. Overall, Powell has tried to keep a low profile and avoid feuding with the White House. A solid economy, at least before the coronavirus outbreak, also helped protect the Fed during Trump’s first term.
Powell often cited support from Capitol Hill to balance Trump’s attacks. At a press conference last July, Powell discussed the importance of keeping the Fed away from “direct political control” because it allows the central bank to take unpopular measures, such as raising interest rates to curb inflation.
“I think this is widely understood,” he said. “Of course, this is in Congress.”
Powell’s public schedule underscores his commitment to staying engaged with Congress. According to Trump’s schedule, in the month after taking office last year, he met with or spoke by phone with 27 senators from both parties.
After Powell testified before the Senate Banking Committee last June about the renovation of the Federal Reserve Building, he discussed the cost of the project with Chairman Tim Scott and ranking member, Democratic Senator Elizabeth Warren.
“As expected from a major renovation of a nearly 100-year-old building, the committee’s design continued to evolve over the course of the project,” Powell wrote.
Allegations against Powell
The subpoena to the Fed was related to Powell’s remarks about spending $2.5 billion to renovate two office buildings, which Trump criticized as excessive.
“The threat of criminal charges is the result of the Fed setting interest rates based on our best assessment of serving the public, rather than following the president’s preferences,” Powell said in a video statement.
Trump insists he was unaware of the investigation into Powell. When asked by CBS News whether the subpoena was a form of retaliation, Trump said Tuesday, “I can’t control what it looks like.”
Trump has gone after several officials he believes have done wrong to him, including trying to fire Lisa Cook, another Fed board member. The Supreme Court allowed Cook to keep her job and will hold a hearing on her case on Wednesday.
But not all of Trump’s efforts have been upheld, with federal investigations into former FBI Director James Comey and New York Attorney General Letitia James being dismissed by courts.
“So far, this appears to be a misstep by the administration,” said Lev Menand, a Columbia University law professor and author of a book about the Fed. “This attempt to potentially criminally prosecute Jay Powell is leading to a backlash from elected officials, even within the Republican Party.”
