The Federal Reserve’s independence is still under threat, warns Rebecca Slaughter

{"text":[[{"start":7.7,"text":"Rebecca Slaughter has a warning for the Federal Reserve."}],[{"start":11.850000000000001,"text":"The former Federal Trade Commission member, who lost a Supreme Court challenge over her firing by President Donald Trump, said the high court’s ruling protecting Fed governors from the same fate was not “durable”."}],[{"start":22.700000000000003,"text":"“The only way to really rationalise the [Fed] decision is that the Supreme Court has decided that there is a special exception for Wall Street that doesn’t apply to Main Street,” Slaughter said in an interview with the FT. "}],[{"start":34.95,"text":"“I don’t think that makes it a very durable exception,” she added."}],[{"start":39.2,"text":"Trump dismissed Slaughter in March 2025 without cause, prompting a high-profile legal battle challenging her removal. When the US Supreme Court sided against her in a 6-3 decision, justices gave the White House broad power over historically independent agencies and eviscerated decades-old precedent."}],[{"start":58.25,"text":"They drew a line at the steps of the US central bank by siding 5-4 with Fed governor Lisa Cook, whom Trump also tried to fire. But Slaughter is worried about how the rulings chip away at federal agency autonomy."}],[{"start":72.9,"text":"“For me, personally, I’m fine,” Slaughter said. “I’m very concerned for the agency that I love, the staff that work there, the structures of government generally, and most importantly, the people that the government is supposed to serve.”"}],[{"start":null,"text":"

"}],[{"start":86.60000000000001,"text":"Even before her firing, the “wrecking ball” Trump took to the federal government instilled fear among FTC members and staff about their job security and the ethical dilemmas they might face, Slaughter said."}],[{"start":98.50000000000001,"text":"She said she expected the ruling on her dismissal would lead to much more dramatic swings in policy and practice than the agency has seen in the past century and greater opportunities for political gamesmanship."}],[{"start":110.40000000000002,"text":"“The message President Trump sent by firing me was not just, ‘I don’t want Democrats there’,” she said. “It was, ‘I don’t want anyone who will not do exactly what I say, exactly when I say it’.”"}],[{"start":122.25000000000001,"text":"Trump had also targeted Jay Powell — whom he appointed chair of the central bank’s board of governors — over frustrations that he refused to cut interest rates more quickly. The Department of Justice launched a criminal probe against Powell but shuttered it after a judge found “abundant evidence” it amounted to a pressure campaign."}],[{"start":141.65,"text":"To court watchers, the Supreme Court’s Slaughter decision did not come as a surprise. The top court’s conservative majority has long had its eye on dismantling the so-called administrative state, the web of government agencies empowered to create and enforce rules and regulations."}],[{"start":null,"text":""}],[{"start":158.75,"text":"That put a spotlight on Humphrey’s Executor vs US, the landmark 1935 Supreme Court case that enabled Congress to prohibit presidents from removing independent agency members without cause."}],[{"start":172.3,"text":"At oral arguments in December, Chief Justice John Roberts called Humphrey’s Executor — which the court overturned in its Slaughter ruling — a “dried husk of whatever people used to think it was”. Justice Amy Coney Barrett noted an “eroding” of the decision over the years, and Justice Neil Gorsuch called it “poorly reasoned”. "}],[{"start":191.4,"text":"In 2020, Justice Clarence Thomas wrote that the precedent posed a “direct threat to our constitutional structure and, as a result, the liberty of the American people”."}],[{"start":201.20000000000002,"text":"Slaughter noted that, while “unprecedented destruction” of government institutions has occurred under Trump, eradicating Humphrey’s Executor has long been a “cause célèbre” of the conservative legal movement."}],[{"start":213.25000000000003,"text":"“Trump gave them the opportunity,” she said, “but it was something conservatives have been pushing for.”"}],[{"start":218.45000000000002,"text":"Jessica Levinson, a law professor at Loyola Marymount University, said the ruling against Slaughter would give Trump and future presidents greater power to shape the FTC and the other “alphabet agencies” while limiting Congress’s power to protect them."}],[{"start":233.70000000000002,"text":"It is expected to imperil lawsuits filed by numerous officials fired from agencies whose responsibilities span the enforcement of labour laws to the administration of copyright laws."}],[{"start":244.25000000000003,"text":"Already, those ripple effects have been felt. The Trump administration last week pushed out remaining members of the bipartisan Election Assistance Commission, tasked with helping election officials better the administration of political contests."}],[{"start":257.85,"text":"A White House official told the FT that Trump is entitled to remove individuals who “may not be totally aligned with the important task of securing America’s elections”, citing Slaughter’s case."}],[{"start":268.45000000000005,"text":"Despite the vast control the president has over once-insulated agencies, some say the diverging outcomes of Slaughter’s case and that of Cook prove the Supreme Court’s restraint."}],[{"start":280.20000000000005,"text":"Kannon Shanmugam, head of the Supreme Court and appellate practice at Davis Polk, suggested the ruling shows the top court is “a lot more pragmatic than most of its critics think”."}],[{"start":290.80000000000007,"text":"“There are those who say this just proves that the court is being unprincipled,” Shanmugam said. “But I think it shows that the court is being principled, but that there are limits where the court has concerns about the practical implications.”"}],[{"start":303.50000000000006,"text":"“And I think the court has a great deal of concern about disrupting the markets and the financial system,” he added."}],[{"start":309.80000000000007,"text":"Slaughter’s own future is uncertain."}],[{"start":312.25000000000006,"text":"Her term at the FTC would have expired in 2029 and her plan had been to serve it out. She said she remains committed to “mission-driven work”, in whatever form that may take, and expects teaching to feature in her next act."}],[{"start":327.55000000000007,"text":"But she is “definitely not” running for office, which she likens to a “pie-eating contest where the prize is more pie”."}],[{"start":334.50000000000006,"text":"Ultimately, she is hopeful that the top court’s decision on her case, which she believes is “incorrect”, will not stand."}],[{"start":342.15000000000003,"text":"“I’m very cognisant of the fact that I lost and it’s going to cause this massive transformation in the way government works, and that is extremely disappointing,” Slaughter said. “But I also think I and the folks who lined up with me . . . will be shown indubitably to be on the right side of history.”"}],[{"start":358.65000000000003,"text":"“I don’t in any way see the case as the end of the conversation,” she added."}],[{"start":371.90000000000003,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1784632405_6520.mp3"}