Jeffrey Lacker

Reserve Bank Removal Powers Could Expose the Fed to Presidential Control

At a Hoover Institution conference on central-bank governance, John Cochrane, Edward Nelson, Gary Richardson and David Wilcox treated Federal Reserve independence as a delegated legal structure rather than a self-executing norm. Richardson argued that Congress designed the Fed to frustrate presidential control, while Wilcox warned that ambiguous authority over Reserve Bank presidents could still give a determined president a path into the FOMC. Nelson added that independence protects the Fed’s operational judgment, not the quality of its monetary doctrine.