As Trump Seeks to Install His Chief Economist Stephen Miran on Fed Board, Reed Warns Fed’s Loss of Independence is a Serious Threat to U.S. Economy

WASHINGTON, DC - Today on the Senate floor, U.S. Senator Jack Reed, a leading member of the Senate Banking, Housing, and Urban Affairs Committee, urged his Senate colleagues to vote against Dr. Stephen Miran's nomination to be a Member of the Federal Reserve Board of Governors and warned that President Trump's assault on the Fed's independence could have devastating economic consequences for all Americans. Text of Senator Reed's remarks follow and video is available here:

SEN. REED: Mr. President, I rise in opposition to President Trump's nomination of Stephen Miran to be a Governor of the Federal Reserve Board.

The Federal Reserve is among the most important economic institutions in the world. Simply put, it is authorized to create money and determine the cost of that money by setting interest rates, all with a goal of achieving maximum employment and stable prices.

When its seven Board members have a degree of protection from political interference, then the Fed is better able to contribute to sound economic policy for the Nation. That's because they have freedom to make tough decisions that may not be favored by the White House but that are necessary to achieve its dual mandate.

It is unfortunate that Dr. Miran demonstrated at his nomination hearing that he is a political partisan and that he will be President Trump's man at the Fed.

As if to emphasize the point, Dr. Miran intends to perform this job while "on leave" from his current position as the Chair of the Council of Economic Advisers at the White House. In other words, he will be keeping his job as the President's chief economic adviser while being able to vote on interest rates.

An architect of Trump's tariffs -- which have stoked inflation and under which American families and businesses are suffering every single day -- Dr. Miran will now have one foot in the Fed and his other foot in the White House.

Someone with this atrocious track record -- someone who has been a hardcore proponent of Trump's policies that raise costs on everyday goods, that debase and devalue the dollar, that are based on unconstitutional notions that executive power has no limits -- does not deserve a second job that comes with additional levers to damage the economy.

So I will be voting no on Dr. Miran based on his track record and qualifications.

I will also be voting no because he will be making a mockery of the law by refusing to relinquish his White House job.

The Federal Reserve Act says that "The members of the Board shall devote their entire time to the business of the Board." This means quite simply that Dr. Miran can have no contact with the White House whatsoever while at the Fed. In other words, there must be very strong firewalls separating Miran's Fed duties from his White House duties.

Those firewalls will not work for this President, who demands that his advisors serve his own personal interests, who demands total fealty, and who acts as if he is above the law.

Those firewalls will not work for this agency because Trump is obsessed with browbeating the Fed into submission. He routinely demands that the Fed cut rates from 4.25% to 1%. He has tried to intimidate Chair Powell-a Republican whom Trump first appointed…calling him a "loser," "stupid," "corrupt," and "incompetent" because he won't do exactly what Trump wants.

Traditional firewalls will not work for this nominee. As the President's chief economist, Dr. Miran will almost certainly pick up the phone if Trump calls. He will be reading Trump's social media posts. He has every incentive to do Trump's bidding so he can return to his White House job. In the unlikely event that Dr. Miran acts independently, then Trump can oust him from the CEA.

Most troubling, Dr. Miran has testified that he has received advice from White House lawyers blessing this arrangement. This kind of self-certification is dubious at best, but Dr. Miran has failed to produce it. That's why I joined Ranking Member Warren and several of our Banking Committee colleagues in demanding that Dr. Miran share this analysis. As is typical with this Administration, he did not even respond to our request.

Dr. Miran's stonewalling can only be read as a concession that this is a corrupt bargain.

Critical questions remain unanswered because of Dr. Miran's contempt of the Banking Committee, his evasion of our questions, and his refusal to provide details about this fraught proposal to retain his White House job while at the Fed. He must be straightforward and honest about how he intends to do this job. And he must acknowledge the reality that the President will have enormous influence and leverage over him. We must have answers before the Senate votes on his nomination.

I will also be voting no because Dr. Miran has shown exceptionally poor integrity in this confirmation process.

He tweeted in 2023 that no person "on the planet can go from highly political operative to politically neutral just because he or she gets a promotion. That's just not how human beings work." He said this during the Biden Administration, when a Fed Governor resigned to become an economic advisor to the President in the White House. Dr. Miran himself now wants to move between the Fed and the White House. Under Dr. Miran's own standard, he would need to violate the laws of physics to be capable of acting independently.

Just last year, Dr. Miran wrote a 25-page paper proposing an overhaul of the structure and governance of the Fed. In that paper, he wrote that "short-circuiting the revolving door between the Fed and the executive branch is critical to reducing the incentives for officials to act in the short-term political interests of the president." Yet he is now racing through this revolving door.

He called for specific reforms to shut this revolving door. Those reforms include prohibiting any Governor from returning to the executive branch for four years; removing the "for cause" removal protections for Governors; and the current President voluntarily refraining from removing any incumbent Board members or Reserve Bank leaders during his term.

At his confirmation hearing, Dr. Miran didn't even try to stand by these proposals. He testified that this "proposal was a package deal. It was a suite of checks and balances, and it's highly inappropriate to take one check or balance outside the context of the overall package."

Dr. Miran badly mischaracterized his own work. In his paper, Dr. Miran never said that these proposals as a "package deal" or that they must be implemented in an all-or-nothing manner. To the contrary, he wrote that this "proposal can be implemented in a piecemeal fashion, one policy at a time, if legislatively easier."

This nominee is asking for the American people's trust to set the Nation's credit and monetary policy.

By misleading the Banking Committee, he has demonstrated that he cannot be trusted with that responsibility.

Like so many of this Administration's nominees, Dr. Miran knew that standing by his previous views would take him out of the running. So he disavowed them to avoid getting crosswise with Trump, who wants to get his man confirmed to the Fed today -- which happens to be the day before the Fed's next meeting to vote on interest rates.

Trump's former economics advisor Larry Kudlow said the quiet part out loud on a podcast last week. He said, "The bottom line is: Trump is going to take over the Fed."

Dr. Miran's appointment is a critical piece of Trump's hostile takeover along with the attempted ouster of Governor Cook and the disgusting attacks on Chair Powell. When the Fed becomes controlled by Trump's yes-men, it won't speak with enough authority to achieve its mandate. Inflation will get out of control and higher prices will persist. Rates on credit cards, auto loans, and mortgages will go up. Working Americans will be asked to pay more to finance our Nation's enormous and growing public debt. This outcome is unacceptable when millions of Americans are struggling to cover increased costs for everyday expenses.

I would like to close by quoting former Republican Senator Pat Toomey from Pennsylvania, who ably served as the Ranking Member of the Banking Committee. In 2021, he spoke against one of President Biden's nominees to the Federal Reserve and said, "The American people deserve a serious nominee who will serve without a political agenda. It is exceptionally important to keep politics out of monetary policy."

Applying Senator Toomey's principles, Dr. Miran has not demonstrated his ability to "serve without a political agenda." He has not demonstrated that he is a "serious nominee." And he has not demonstrated that he "will serve without a political agenda."

Instead, he has demonstrated his loyalty to Trump and thumbed his nose at the Senate. He has already compromised his independence through his plan to hold on to his White House position.

I urge my colleagues to vote against this nominee.

Thank you, Mr. President. I yield the floor.

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