Supreme Court appears hesitant to let Trump fire Fed governor

A majority of the Supreme Court justices on Wednesday appeared hesitant to let President Trump fire Federal Reserve Governor Lisa Cook during oral arguments in the emergency case.Trump tried to fire Cook in August, the first time a president has attempted to fire a sitting Fed governor in the bank’s 112-year history, claiming that the termination was over allegations that she committed mortgage fraud, The Hill reported. Cook has denied the allegations.
“We have to be aware of what we’re doing and the consequences of your position for the structure of the government,” Justice Brett Kavanaugh said.
“There’s a risk,” Justice Amy Coney Barrett noted.
Trump fired Cook as he had criticized the Fed for not lowering interest rates more quickly.
While the Federal Reserve Act prevents the president from terminating governors except “for cause,” it doesn’t define what “cause” includes.
Solicitor General D. John Sauer urged the Supreme Court to adopt a broad standard that covers any cause related to a Fed governor’s conduct, ability, fitness, or competence.
Sauer said Cook’s alleged conduct “sends the wrong message to the market and to the American people who have to make correct representations to the banks.”
Cook’s lawyer, Paul Clement, argued that the court should adopt the removal standard used at some other agencies, which requires one of three causes: inefficiency, neglect of duty, or malfeasance in office. 
“There is simply no reason to abandon over 100 years of central bank independence on an emergency application on a preliminary record,” Clement said.
Several justices suggested that the court may send the case back to the lower courts to work through some of the issues.
“We know that the independence of the agency is very important, and that that independence is harmed if we decide these issues too quickly,” Justice Sonia Sotomayor said.
Cook has remained on the Fed’s board during the legal proceedings.

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