Senator Lummis Calls for Powell’s Resignation
In a bold move, Senator Cynthia Lummis from Wyoming has publicly condemned Federal Reserve Chairman Jerome Powell and is demanding his resignation amid rising tensions over the central bank’s policies. Lummis, known for her advocacy of cryptocurrency as the head of the Senate Banking Subcommittee on Digital Assets, has taken issue with Powell’s role in what she describes as “Operation Choke Point 2.0,” a government effort perceived to stifle the crypto industry.
Criticism of Powell’s Leadership
Throughout the year, Powell has faced significant scrutiny and criticism. Not only has he been publicly challenged by President Trump for his cautious approach to interest rates—heightened by ongoing inflation above the Fed’s target of 2%—but he has also been accused of perjury by Republican Representative Anna Luna from Florida. Trump believes that the reluctance to increase rates is costly for the federal government, which, as reports suggest, is currently spending over a trillion dollars to manage the nation’s substantial $36.67 trillion debt.
Concerns Over Bank Regulation
Lummis’s concerns do not solely revolve around monetary policy; they extend into the realm of bank regulation. She has accused the Fed of advising financial institutions that associations with cryptocurrency firms could pose a reputational risk, which she argues has led to the exclusion of many crypto enterprises from the banking system. Though the Fed recently announced a removal of this reputational risk factor in its supervisory practices, Lummis says this change is insufficient and continues to criticize Powell’s leadership.
Statements from Senator Lummis
On June 23, Lummis expressed that while the scrapping of the reputational risk factor is a positive step, it should not excuse Powell’s overall conduct.
“There is still more work to be done,”
she noted, adding a few weeks later,
“Jay Powell has proven time and time again that he is unfit to run the Fed. He must resign now.”
Further Grievances and Implications
In a recent Fox News interview, Lummis elaborated on her call for Powell’s departure, outlining a range of grievances, including the considerable cost overruns associated with the $2.5 billion renovation of the Federal Reserve building, which has exceeded its budget by $700 million. Conclusively, she stated,
“I think now there’s enough evidence that he’s worn out his welcome.”
Lummis’ escalating demands for Powell’s resignation may signify a turning point in the political and regulatory discourse surrounding the Federal Reserve and its management of the financial landscape in the U.S.
