Any president can fire anyone in the executive branch

On Monday, President Trump moved to fire Lisa Cook, a Biden-nominated member of the Federal Reserve’s Board of Governors. He moved to fire Cook for “cause,” and that cause is clear enough: According to William Pulte, the director of the Federal Housing Finance Agency, Cook allegedly committed mortgage fraud by lying about her principal place of residence for purposes of securing more favorable interest rates — and then failed to report her rental income from the properties, to boot.

Trump’s move is the first time a president has ever tried to fire a Fed governor for cause, and Trump’s usual detractors have criticized him for his latest perceived violation of institutional norms. But Trump has acted appropriately; he is fully within his constitutional and statutorily delegated authority to remove Cook — whether for “cause” or not.

Let’s return to first principles.

The modern administrative state operates as a fourth branch of government, unmoored from direct political accountability. Its very existence, to say nothing of its present metastasis, is in irreconcilable tension with the American founders’ vision of a clearly delineated tripartite separation of powers between Congress, the executive branch and the judiciary.

Article II of the Constitution vests the entirety of the “executive power” in the hands of the president. And as Chief Justice William Howard Taft (a former president) made clear in Myers vs. United States in 1926, this includes the power to remove executive branch officers. While the New Deal-era case Humphrey’s Executor in 1935 carved out a dubious exception for “independent” agencies, constitutionalists have long understood Humphrey’s as an aberration in need of reversal.

Indeed, the Supreme Court has been chipping away at this edifice. In Seila Law vs. Consumer Financial Protection Bureau in 2020, the Roberts court held that Congress cannot insulate a lone executive officer — in that case, the director of the bureau — from at-will presidential removal. In Collins vs. Yellen in 2021, the court extended that logic further, holding that restrictions on the president’s ability to remove the head of the Federal Housing Finance Agency are also unconstitutional.

It is true that in Trump vs. Wilcox, a case from earlier this year in which the court green-lit Trump’s dismissal of a Biden-nominated member of the National Labor Relations Board, the court did opine that arguments about the legitimacy of for-cause removal provisions for labor board members do not necessarily implicate similar for-cause restrictions for members of the Fed’s Board of Governors. The court’s brief two-page order in Wilcox described the Fed as a “uniquely structured” entity.

But is it? Or perhaps more precisely — can it legitimately be? Members of the Fed’s Board of Governors are appointed by the president and confirmed by the Senate. They exercise significant policymaking authority, affecting the economy, interest rates and the value of the dollar. That is executive power under any reasonable understanding of the term.

Even more to the point, if the Fed is not part of the executive branch such that the president is able to wield plenary removal power, then where exactly is it? Surely, the Fed is not part of Congress or the judiciary. The Wilcox order opines that the Fed “follows in the distinct historical tradition of the First and Second Banks of the United States,” but this analogy is specious. The First and Second Banks of the United States didn’t actually serve modern central bank functions. And the Fed, birthed in 1913, was the brainchild of Woodrow Wilson, the godfather of the modern administrative state. Legally, the Fed is more analogous to the rest of the administrative state.

Ultimately, Trump must be able to fire members of the Fed’s Board of the Governors — or else the Fed is structured in an unconstitutional manner. There is no tenable middle ground here.

What about the relevant authorizing statute? The Federal Reserve Act of 1913, which brought the Fed into existence, sets staggered 14-year terms for governors and doesn’t expressly provide for at-will removal. But it also doesn’t specify what constitutes a legitimate “cause” for a governor’s removal. Congress could have specified that “cause” requires, as Cook’s counsel Abbe Lowell now argues, a Fed governor to first be indicted or convicted of a crime. But Congress didn’t specify that.

“Cause” absent such specification is an inherently subjective criterion. And what could be more legitimate of a cause for removing a governor of the nation’s central bank — which is, among other things, the lender of last resort to the country’s financial institutions — than the alleged defrauding of financial institutions? The allegations raise serious concerns about the legitimacy of the Fed. It is in the national interest to preserve that legitimacy.

Let’s also not forget: Term length does not equal tenure protection. Saying governors serve “for 14 years” is not the same as saying they cannot be removed within that time period. Courts have made this distinction plenty of times before — consider, for instance, the (legitimate) 2017 dismissal of James Comey, who was less than four years into what was to have been a 10-year tenure as FBI director.

The lawsuits will come anyway. So be it. Those fights are worth having. Trump’s first term was plagued by internal sabotage from bureaucrats and agency officers who fancied themselves a co-equal branch of government. It is imperative that Trump’s second term not repeat that tragic mistake. And the first for-cause removal of a sitting Fed governor sends an unmistakable message: The American people, through their elected president, will once again take the reins of government.

Josh Hammer’s latest book is “Israel and Civilization: The Fate of the Jewish Nation and the Destiny of the West.” This article was produced in collaboration with Creators Syndicate. @josh_hammer