Questions about the future of the Federal Reserve’s independence took center stage on September 4, 2025, as Stephen Miran—President Donald Trump’s nominee to the U.S. central bank’s governing board—faced a tense confirmation hearing before the Senate Banking Committee. The hearing unfolded against a backdrop of unprecedented presidential intervention in Fed affairs, with lawmakers from both parties pressing Miran to clarify whether he would act as a political loyalist or defend the Fed’s historic autonomy.
Miran, a Harvard-educated economist and current chair of Trump’s Council of Economic Advisers, has drawn scrutiny for his past criticisms of the Fed’s independence and his public support for proposals that would give the president more direct authority over the central bank. According to Reuters, Miran has previously written in favor of allowing the president to fire Fed governors at will and has advocated for shortening their 14-year terms—moves that would fundamentally reshape the institution’s relationship with the White House.
During the confirmation hearing, Miran attempted to strike a conciliatory tone, stating, “Independence of monetary policy is a critical element for its success.” He repeatedly emphasized his intent to preserve the Fed’s independence and make decisions based on sound economic analysis and what’s best for the country’s long-term stewardship. “That said, I’m always happy to hear views from every source possible...to challenge my own views and interrogate them,” he told the committee, as reported by Reuters.
This posture shift comes as President Trump has intensified efforts to exert control over the central bank. In an unprecedented move just days before the hearing, Trump attempted to fire Fed Governor Lisa Cook, claiming—without substantiation—that she had committed mortgage fraud during her time as an economics professor. Cook has sued, alleging her removal was a pretext for refusing to lower interest rates, and the Justice Department has opened a criminal investigation. She remains at the Fed while the case is pending.
The legality of Cook’s firing has become a flashpoint in the broader debate over Fed independence. Committee Democrats, led by Senator Elizabeth Warren of Massachusetts, have argued that the Senate should not confirm any new Fed nominees while the matter is unresolved in court. “We shouldn’t have a hearing for nominations on Thursday,” Warren insisted, as quoted by Politico. “The Banking Committee should have a hearing on Donald Trump’s monthlong attack on the independence of the Fed.”
Warren, the committee’s highest-ranking Democrat, used her opening remarks to frame the proceedings as a referendum on the Fed’s autonomy. She highlighted what she described as three major attacks by Trump: threatening to fire current Fed Chair Jerome Powell, criticizing Powell’s spending on headquarters renovations as a pretext for removal, and the ongoing effort to oust Lisa Cook. “All of them are direct attacks on the independence of the Fed,” Warren told NPR. She warned that politicizing the Fed would have real-world consequences, saying, “If we have a totally politicized Fed...everyone loses confidence in the Fed, in our central bank, and in the decisions they make. And that ultimately drives up the cost of mortgages and car loans and credit cards for Americans across this country.”
Despite her own history of sharp criticism toward Powell, Warren drew a distinction between policy disagreements and institutional independence. “I have never, ever questioned the independence of the Fed and the Fed’s ultimate power to make those decisions based on their best judgment of what’s good for the United States of America,” she said. She also noted that some Republican colleagues value Fed independence regardless of which party holds the White House, adding, “We need independence, really, across the board, for our financial regulators.”
The hearing itself was marked by pointed—and sometimes personal—questioning. Senator John Kennedy, a Louisiana Republican, bluntly asked Miran, “Are you a Donald Trump puppet?” Miran replied, “Not at all.” Kennedy shot back, “We are going to hold you to that.” Democratic Senator Andy Kim pressed Miran on whether anyone in the administration had asked him, formally or informally, to vote to lower interest rates. “No,” Miran responded, according to Reuters.
Warren, unsatisfied by Miran’s assurances, grilled him on whether he believed Trump lost the 2020 election and if he agreed with the president’s claims that recent jobs data were faked. Miran sidestepped the election question, stating only, “Joe Biden was certified by Congress as the President of the United States.” On the jobs data, he reiterated concerns about “data quality” at the Bureau of Labor Statistics.
Republicans, who control the Senate Banking Committee and hold 53 seats in the 100-member Senate, have signaled their intent to move quickly on Miran’s confirmation. The goal is to have him in place to participate in the Fed’s upcoming September 16-17 rate-setting meeting. Miran is nominated to fill a seat unexpectedly vacated last month by Fed Governor Adriana Kugler, a term that ends January 31, 2026. At that point, Trump could renominate him for a full 14-year term or select another candidate.
Some Senate Republicans, including pivotal swing vote Thom Tillis of North Carolina, appear inclined to support Miran, with Tillis describing himself as a “lean yes.” Others, like Senator Kennedy, have said they will use the hearing to probe Miran’s views on central bank independence. According to Politico, even those who have publicly stressed the need for an independent Fed are signaling likely support for Miran, who was previously confirmed as CEA chair with unanimous GOP backing.
Still, concerns about the potential consequences of undermining the Fed’s autonomy remain front and center. Oxford Economics analysts warned in a note that “a less independent Fed would likely favor more aggressive rate cuts, reflected by lower rates at the front end of the Treasury yield curve, at the expense of higher inflation, captured by higher rates at the long end of the curve.” In other words, if the courts uphold Trump’s authority to remove Cook and replace her with a loyalist, it could send inflation expectations and long-term interest rates higher—posing risks for the broader U.S. economy.
Market reaction to Miran’s nomination and Trump’s attempted removal of Cook has so far been muted, but observers caution that the real test will come if the courts back Trump’s moves. Meanwhile, the Fed itself is widely expected to cut rates in coming meetings, though perhaps not as aggressively as the president would like. Two Trump appointees from his first term—Vice Chair for Supervision Michelle Bowman and Governor Christopher Waller—dissented against the Fed’s July decision to hold rates steady and are reportedly under consideration to succeed Powell when his term expires in May.
As the dust settles on Miran’s contentious hearing, the fate of the Fed’s independence—and its ability to steer the U.S. economy free from political interference—remains an open question. The coming months will likely determine whether the central bank’s century-old tradition of autonomy can withstand the pressures of a new political era.
