Politics
Supreme Court appears ready to keep Lisa Cook on Federal Reserve board despite Trump efforts to fire her
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The Supreme Court appeared poised to give President Donald Trump one of his biggest legal setbacks in office, offering strong support Wednesday for Federal Reserve Governor Lisa Cook remaining in her leadership position — at least for now.
The justices debated in their packed courtroom whether Trump has broad unilateral executive authority to fire someone from the central bank, despite its special status as a stand-alone federal agency.
During nearly two hours of oral arguments, a majority seemed to agree the Fed’s unique public-private hybrid structure limited removal without clear “cause,” and that Trump did not meet his legal obligations when seeking Cook’s dismissal for alleged private mortgage fraud.
REPUBLICAN SENATOR VOWS TO BLOCK TRUMP FED NOMINEE OVER POWELL INVESTIGATION
Federal Reserve governor Lisa Cook and attorney Abbe Lowell, arrive at the Supreme Court in Washington, Wednesday, Jan. 21, 2026. (Mark Schiefelbein/AP Photo)
The case comes before the Supreme Court on an emergency basis — with the government seeking to dismiss Cook now, for as long as the courts decide the matter, a process that could last months.
The justices could decide the larger constitutional questions now or give the lower federal courts a chance for a full examination of the facts, with some guidance from the high court on the standards of “for cause” removal.
In arguments, most on the court seemed skeptical of Trump’s actions.
“That’s your position that there’s no judicial review, no process required, no remedy available?” Justice Brett Kavanaugh asked Solicitor General D. John Sauer. “Very low bar for cause that the president alone determines. And that would weaken, if not shatter, the independence of the Federal Reserve.”
“Let’s talk about the real-world downstream effects of this. Because if this were set as a precedent, it seems to me just thinking big picture, what goes around, comes around,” added Kavanaugh, who has typically been an ardent defender of executive power. “All the current president’s appointees would likely be removed for cause on January 20th, 2029 — if there’s a Democratic president or January 20th, 2033. And then, we’re really at, at will removal.”
Others on the bench raised questions of “public confidence” if the president could fire Fed governors without fully explaining or justifying the reasons.
“We have amicus briefs from economists who tell us that if Governor Cook is” fired, asked Justice Amy Coney Barrett, “that it can trigger a recession. How should we think about the public interest in a case like this?”
The Competing Arguments
Cook’s lawyer told the nine-member bench court the Federal Reserve System was created by Congress in 1913 as a wholly independent entity, to insulate it from political influence, and from any one president “stacking the deck” with their own nominees.
The first Black female Fed governor claims to be a political pawn in Trump’s very public efforts to dictate the board’s interest rate policies and by exploiting what she calls “manufactured charges” of wrongdoing.
GOP SENATOR SUGGESTS FED CHAIR POWELL RESIGN NOW TO DODGE POTENTIAL CRIMINAL INDICTMENT
President Donald Trump speaks with Federal Reserve chair Jerome Powell (R) as he visits the Federal Reserve in Washington, D.C., on July 24, 2025.
With Cook in the audience as a show of support was Fed Chairman Jerome Powell, whom Trump has also sought to remove in a broader, ongoing feud with the agency over the pace of lowering benchmark interest rates to spur the domestic economy.
But the Trump Justice Department said he had executive authority to seek Cook’s removal, free from judicial review.
Independent Agency Review
The conservative court has allowed much of Trump’s challenged executive actions to be enforced at least temporarily — including upholding firings of members of the National Labor Relations Board, the Merit Systems Protection Board, the Consumer Product Safety Commission, and the Federal Trade Commission, despite federal laws protecting them against removal without good cause.
The justices last month heard arguments in a separate case, on Trump’s efforts to remove Democrat-appointed Rebecca Slaughter from the Federal Trade Commission (FTC), which, like the Fed, is a congressionally-created independent, multi-member regulatory agency.
The 6-3 conservative majority in that petition appeared ready to rule for the president when it involves semi-autonomous agencies like the FTC.
But in the Federal Reserve dispute, the high court clearly indicated this institution was different.
In the Cook case, lower courts ruled she did not receive due process when the president tried to fire her.
The current posture of the case is whether Trump can remove Cook — at least temporarily — while the dispute continues to play out on the merits.
The “for cause” removal restriction’s constitutionality is not directly before the justices, but nevertheless played a key role in the oral argument session.
The Supreme Court could go ahead and settle the competing issues now — which seems unlikely — or leave it to the lower courts to continue hearing the appeal, with guidance on how to proceed.
Focus on the Fed
Though its leaders are appointed by the president and confirmed by the Senate, the seven-member board is considered an independent government agency, since its monetary policy decisions do not need presidential or legislative approval. But the agency does provide Congress with regular reports on its work.
It also does not receive any federal funding, and the terms of the members of the board of governors span multiple presidential and congressional terms.
Under law, the Federal Reserve’s leadership has a three-fold mandate: “maximum employment, stable prices, and moderate long-term interest rates.”
The 12 Federal Reserve Banks are not part of the federal government, but set up like private corporations, and regionally located across the country.
In arguments, most justices agreed Cook deserved some chance to make her case that a dismissal would be improper.
SUPREME COURT PREPARES FOR MAJOR TEST OF PRESIDENTIAL POWER IN TRUMP EFFORTS TO FIRE FEDERAL RESERVE GOVERNOR
The Supreme Court building in Washington, D.C. (AP Photo/J. Scott Applewhite, File)
“Why are you afraid of a hearing?” asked Justice Amy Coney Barrett, at one point.
Justice Neil Gorsuch asked: “Let’s, just suppose with me, hypothetically, for the moment, that the court read the act to require notice and a hearing … What would that hearing look like?”
Gorsuch asked if the president could just call Cook into the White House Roosevelt Room. “So just a meeting across a conference table, finish with ‘you’re fired?’”
But Chief Justice John Roberts repeatedly said a hearing on the allegations would serve little use if her only defense is she made an “inadvertent error” on her mortgage application.
The public session also focused extensively on the standards of “cause” that would permit Cook’s dismissal. Several justices suggested the mortgage fraud claims against Cook were not serious enough to trigger emergency action requested by the government to remove her at least temporarily.
Existing statutory removal protections include the so-called “INM standard” — “inefficiency, neglect of malfeasance.”
“The question becomes, is it grossly negligent to make a mistake on a mortgage application?” said Justice Sonia Sotomayor.
Justice Samuel Alito also asked why the case was handled “in such a hurried manner,” suggesting concern the allegations against Cook have not been properly adjudicated, either by the courts or by the president himself.
In a statement after the hearing ended, Cook said her case is “about whether the Federal Reserve will set key interest rates guided by evidence and independent judgment or will succumb to political pressure.”
The Impact
The Federal Reserve Act (FRA) says the president can only remove members of the Fed board and FOMC “for cause.” The exact parameters of that standard were not spelled out in the original law, and never fully tested in the courts.
Cook — appointed for a 14-year term by former President Joe Biden in 2023 — will remain on the job at least until the court decides the current legal questions.
SUPREME COURT TEMPORARILY GREENLIGHTS FIRING OF BIDEN-APPOINTED FTC COMMISSIONER
Lisa DeNell Cook is sworn in during a Senate Banking nominations hearing on June 21, 2023, in Washington. (Drew Angerer/Getty Images)
No president has fired a sitting Fed governor in the law’s 112-year history.
She strongly denies accusations of falsely claiming two homes in Georgia and Michigan as her primary residence to secure better mortgage terms. She has not been charged with any crime.
Cook sued the administration last August in a bid to keep her job.
Just after the court arguments ended, Cook released a statement saying her case is “about whether the Federal Reserve will set key interest rates guided by evidence and independent judgment or will succumb to political pressure.”
The next Federal Open Market Committee (FOMC) meeting is scheduled for January 27 and 28, with an expected interest rate decision. Both Powell and Cook are each set to participate.
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Financial markets, private banks, businesses, and investors will be closely watching what the Supreme Court does in the Federal Reserve dispute, and a separate pending appeal over Trump’s sweeping reciprocal global tariffs.
A written ruling in that import tax case, which was argued by the justices in November, could come at any time.
The Fed case is Trump v. Cook (25a312). A decision there could come relatively quickly within weeks, or potentially as late as June or early July.
Politics
Medical examiner releases preliminary findings in Lindsey Graham’s death as death certificate remains pending
Lindsey Graham’s sudden death prompts medical questions, political reactions
Fox News senior medical analyst Dr. Marc Siegel examines the shocking death of Sen. Lindsey Graham, R-S.C., at 71. Siegel discusses the emergency response, including chest pains and a delayed entry due to a deadbolt. He connects the death to a family history of heart attacks and considers how a long flight to Ukraine may have contributed to heart stress, dehydration, and a fatal arrhythmia.
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The District of Columbia’s Office of the Chief Medical Examiner on Sunday released preliminary findings indicating Sen. Lindsey Graham suffered an aortic dissection due to arteriosclerotic cardiovascular disease before his death.
Graham, 71, was pronounced dead at George Washington University Hospital at 10:23 p.m. Saturday, according to a joint statement from the Metropolitan Police Department and the District of Columbia’s Office of the Chief Medical Examiner. An autopsy was performed Sunday.
The medical examiner emphasized that the findings are not final and that Graham’s death certificate will remain pending while toxicological and microscopic testing is completed.
“The preliminary examination findings were: Aortic Dissection due to Arteriosclerotic Cardiovascular Disease,” the medical examiner’s office said in a statement.
SEN. LINDSEY GRAHAM DEAD AT 71 AFTER ‘BRIEF AND SUDDEN’ ILLNESS, OFFICE SAYS
Sen. Lindsey Graham, R-S.C., speaks to reporters after a briefing by Trump administration officials on U.S. strikes on Iran at the U.S. Capitol in Washington, D.C., on March 3, 2026. (Nathan Posner/Anadolu)
The office emphasized that the findings are preliminary and that Graham’s death certificate remains pending. Officials said comprehensive toxicological and microscopic testing is routinely conducted when an autopsy is performed in the District and must be completed before the death certificate is updated with the cause and manner of death.
An aortic dissection is a tear in the inner layer of the aorta, the body’s largest artery, that allows blood to flow between the layers of the vessel wall, according to the Mayo Clinic. The condition is considered a life-threatening medical emergency that can lead to severe internal bleeding or organ damage.
Arteriosclerotic cardiovascular disease refers to the buildup of plaque inside the arteries, which can restrict blood flow and increase the risk of serious heart and vascular complications.
LINDSEY GRAHAM, SOUTH CAROLINA SENATOR WHO ROSE FROM SMALL-TOWN ROOTS TO GOP POWER BROKER, DIES AT 71
Sen. Lindsey Graham, Member of the US Senate, speaks to the people during the demonstration for human rights in Iran at Theresienwiese during the 62nd Munich Security Conference on February 14, 2026 in Munich, Germany. (Hannes Magerstaedt/Getty Images)
The release of the preliminary findings comes after Graham, 71, died Saturday night, shocking colleagues in Washington and across the nation.
Graham, a Republican who was first elected to the Senate in 2002 after serving four terms in the House of Representatives, became one of the chamber’s most influential voices on national security, foreign policy and the judiciary. He chaired the Senate Judiciary Committee during President Donald Trump’s first term and was one of the president’s closest allies on judicial nominations and defense policy.
A U.S. flag flies at half-staff over the Capitol on July 12, 2026, after the death of Sen. Lindsey Graham, R-S.C. Emergency dispatch audio reviewed by Fox News Digital documents the emergency response before his office announced his death. (Kevin Carter/Getty Images)
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Following news of Graham’s death, tributes poured in from lawmakers across the political spectrum, with colleagues remembering his decades of public service and his influence on some of the Senate’s most consequential debates.
The Office of the Chief Medical Examiner said it will update Graham’s death certificate after toxicological and microscopic testing is complete.
More than three dozen California legislators are calling for Gov. Gavin Newsom to exempt the state’s film and TV production incentive program from a recently approved cap on corporate tax credits, warning that without action it will be “significantly kneecapped.”
Though the state’s budget has already been approved, the legislators say a solution must be devised before the end of the year so that production companies do not lose the “full value of tax credits they earned in exchange for creating middle-class entertainment industry jobs,” according to a letter dated Friday and addressed to Newsom, State Senate President Pro Tempore Monique Limón and Assembly Speaker Robert Rivas.
“Tax credits earned for creating jobs in motion picture and television production are not the same as tax credits provided for research and development,” the letter states. The legislation “creates short-term budget savings by reneging on commitments made to the entertainment industry and the working families who depend upon it for their livelihoods.”
The letter comes shortly after Newsom signed his final state budget as California’s governor, a $351.7-billion spending plan that includes new limitations on corporate tax credits.
The budget includes a provision that restricts the maximum tax credit companies can claim in a given year to $5 million or 50% of a company’s tax state tax liability, whichever is greater.
Hollywood industry representatives had warned the governor’s office that the new restrictions could affect the state’s production incentive program, which was just bolstered last year to an annual cap of $750 million.
The film and TV industry in Southern California has struggled to rebound from the effects of the pandemic, the dual writers’ and actors’ strikes in 2023 and the exodus of production to other states and countries.
Members who voted for the budget bill had believed there was a carve-out for the film and TV tax credit program, said Assemblyman Rick Chavez Zbur (D-Los Angeles), chair of the Assembly Democratic Caucus.
“I don’t think that anyone understood what this cap was, what it did and that it effectively kneecapped and reverses the progress that we made last year,” Zbur, who co-authored last year’s bill, said in an interview. “We need to have people understand that these changes, which I think people believed were minor, are really significant and will result in significant job loss if we don’t fix them.”
The new changes to the state’s film and TV tax credit program, which included expanded eligibility for additional shows and films, came after intense lobbying from studios and industry workers, who argued that more funding was necessary to lure production back from other states and countries.
Last week, the California Film Commission said the expanded tax credit program was set to deliver $6.6 billion in direct production spending in-state and more than 34,000 cast and crew jobs across the 170 total film and TV shows that received production incentives this year.
Politics
Graham’s death ignites GOP scramble for Senate seat as Trump hints he already has a favorite
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Sen. Lindsey Graham’s, R-S.C., sudden death from an undisclosed illness has triggered a two-pronged approach to replace him, and President Donald Trump will likely be a focal point in the process.
Graham’s passing overnight comes at a time when Republicans in the upper chamber need every vote they can get. The Senate GOP now holds a 52-seat majority, and with the timetable for Sen. Mitch McConnell’s, R-Ky., absence still unclear, that majority is now effectively 51 votes.
That will up the pressure, and drama, to find a replacement for the longtime South Carolina lawmaker.
LINDSEY GRAHAM, SOUTH CAROLINA SENATOR WHO ROSE FROM SMALL-TOWN ROOTS TO GOP POWER BROKER, DIES AT 71
Sen. Lindsey Graham speaks with reporters aboard Air Force One with President Donald Trump and Secretary of Commerce Howard Lutnick on the way back to Washington, D.C., on Jan. 4, 2026. (Jim Watson/AFP via Getty Images)
Trump, during an appearance on NBC’s “Meet the Press” on Sunday, said, “I have somebody that I think would be great.”
“But I don’t want to say it now because it’s just, it’s too soon with Lindsey,” Trump said. “I don’t wanna even talk about anybody, but I do have somebody that I think is really good.”
It’s a process guided by the Constitution and state law. The first step will require South Carolina Gov. Henry McMaster, a Republican, to appoint a replacement for Graham on a temporary basis.
McMaster, a close ally of Trump, can appoint a temporary replacement as soon as he wants. That pick will serve until the next special or general election.
MCCONNELL FACES FRESH CALLS TO COME CLEAN ABOUT HEALTH ISSUES
Fox News Digital did not immediately hear back from McMaster’s office on when he would make the announcement, or who he was considering for the seat.
Graham was already in-cycle running for a fifth term in the upper chamber, and he easily cruised to a primary victory early last month. That means that whoever McMaster taps would serve until the end of the year to finish off the remainder of Graham’s fourth term.
The second prong is finding his long-term successor.
The candidate filing period for that special election to win the GOP nomination opens July 21. The election is slated for Aug. 11, according to South Carolina law.
That race could see several familiar faces in South Carolina GOP politics jumping in, including McMaster himself, who is termed out as governor.
TRUMP’S ENDORSEMENT POWER FACES ANOTHER GOP TEST IN SOUTH CAROLINA AFTER ALAN WILSON ADVANCES
Rep. Nancy Mace, R-S.C., departs the U.S. Capitol after a series of House votes on funding for Homeland Security and a War Powers resolution on Iran on March 5, 2026, in Washington, D.C. (Andrew Harnik/Getty Images)
Trump heaped praise on McMaster, noting that he endorsed his first bid for the White House in 2016.
“Henry’s been a great governor, you know now he’s termed out, but he’s going to do the right thing,” Trump said. “I think Henry will be fantastic.”
There are six members of South Carolina’s GOP congressional delegation who could toss their hats into the mix. Rep. Nancy Mace, R-S.C., who recently lost a bid for the GOP gubernatorial nomination, is eyeing jumping into the special election.
A person familiar with Mace’s plans told Fox News Digital, “Congresswoman Mace is considering a bid to run.”
Then there’s Rep. Joe Wilson, R-S.C., the longest-serving Republican member of the Palmetto State’s delegation. He quickly snuffed speculation about whether he’d leap into the fray.
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“I was grateful to speak with President Trump today reminiscing about our mutual friend, Senator Lindsey Graham,” Wilson said on X. “I assured him my goal is to remain in the House to keep his two-vote majority for the American people!!!”
Then there’s the remaining four: South Carolina Republican Reps. Ralph Norman, who also lost out on scoring the GOP nomination for governor, Russell Fry, William Timmons and Sheri Biggs, none of whom, so far, have signaled that they would jump into the battle for Graham’s seat.
Meanwhile, South Carolina Lt. Gov. Pamela Evette could also be in the mix.
A source familiar told Fox News Digital that Evette is receiving “tons of encouragement from all across the state and from around the country” to serve as the temporary caretaker for Graham’s seat.
The source said that Evette is also being encouraged to run to seek a full six-year term in the Senate.
Evette, a top South Carolina ally of Trump’s and McMaster’s, was endorsed by both as she finished first in South Carolina’s Republican gubernatorial primary in this year’s race to succeed McMaster.
But after Trump also endorsed her GOP rival in the runoff, State Attorney General Alan Wilson, she was trounced by Wilson a few weeks ago in the runoff election
Fox News Digital did not immediately receive responses to requests for comment from possible contenders in the House.
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