President Donald Trump's nominee to fill a vacancy on the Federal Reserve board said at his confirmation hearing that he does not plan to leave his position as chair of the White House Council of Economic Advisers if he is confirmed.
Trump nominated Stephen Miran last month to finish out former Federal Reserve governor Adriana Kugler’s 14-year term, which ends in January. Kugler resigned early and will return to Georgetown University’s faculty this fall.
At the Senate Banking Committee hearing, Sen. Jack Reed, D-R.I., asked Miran whether he would resign from the White House if he were confirmed to the position with the independent Federal Reserve.
"I have received advice from counsel that what is required is an unpaid leave of absence from the Council of Economic Advisers," Miran answered. "And so, considering the term for which I’m being nominated is a little bit more four months, that is what I will be taking."
Reed responded that Miran's "independence has already been seriously compromised by your statement. You are going to be technically an employee of the president of the United States but an independent member of the board of the Federal Reserve? That’s ridiculous."
White House spokesman Kush Desai said in a statement Thursday evening that, “Based on legal guidance, if confirmed, Stephen Miran may take a leave of absence from his CEA position as long as he does not perform any CEA work during his Fed tenure.”
Trump has spent much of his second term directing his ire at the Federal Reserve and its chair, Jerome Powell, over its reluctance to lower interest rates — a move he believes is important to boosting the U.S. economy.
Critics of Trump’s efforts say it is important that the Fed remain independent from political pressure to make sometimes-difficult decisions about interest rates.
Trump has gone so far as to call Powell a “low IQ” person and “very stupid.” Trump also has branded him with the nickname "Too Late" Powell over what he believes has been his slowness to act on interest rates.
Trump also sought to remove Federal Reserve governor Lisa Cook, an appointee of former President Joe Biden, last month after it was alleged that she might have committed mortgage fraud — a move that some of his critics have interpreted as being motivated by his desire to gain more control over Fed policy by appointing more Republicans.
That spurred Cook, who has denied the allegations, to sue to fight the attempt to remove her, which could determine the circumstances under which the president is allowed to fire members of the Federal Reserve board.
After Reed's questions at Thursday's hearing, Sen. Andy Kim, D-N.J., again raised the issue of a potential conflict of interest in Miran's decision not to resign from the White House if he is confirmed to serve at the Fed.
“If I heard you correctly, if you are confirmed to this, you are not going to resign from your current position at the White House?" Kim asked.
Miran repeated almost verbatim what he told Reed, saying, "I have been advised by counsel that the legal approach is to take an unpaid leave of absence from the Council of Economic Advisers, cease my CEA activities, and if counsel advises me otherwise, I will follow the law and follow counsel’s advice."
That drew a chuckle from Kim, who said: “I guess I just wanted to ask you, why did counsel advise you in that way? You have every right to say, ‘No, I’m going to resign.’”
When Miran then said he did not have the legal expertise himself to ignore the counsel's advice, Kim rejoined, "You can determine your own career, you know that, right?"
Kim then asked Miran whether he would go back to the Council of Economic Advisers after his brief term, prompting Miran to answer: "Well, I don’t know what will happen.
"The term for which I’ve been nominated is 4½ months," he continued. "If I am nominated and confirmed for a longer term than just a handful of months, I would absolutely resign."
Kim slammed Miran's answer, questioning whether politics would influence his decisions at the Federal Reserve given that Trump would once again be his boss if he returned to the White House.
"You could very well be continuing to act in a way that is in the political interest of the president because you know he is going to be your future boss again at the White House," Kim said. He said later, "Why do you even want this job at the Fed for four months if you’re just hedging your bets and just continuing to hold your position at the White House?"
Kim and Reed brought up Miran's past written remarks about the value of an independent Federal Reserve as they questioned his plan not to resign.
"You're basically living proof of the criticism you lodged against the Federal Reserve," Reed told Miran.
Miran defended himself repeatedly, maintaining his position that the Federal Reserve should operate independently of the White House.
"If I am confirmed to the Federal Reserve, I'll make it my goal to keep the Federal Reserve to its core missions," Miran said.
Later, he reiterated, "It's important for the Federal Reserve to be insulated from the political cycle."
