Document Type

Notes

Publication Date

5-13-2026

Keywords

Federal Reserve, monetary policy, National Banks, Humphrey's Executor, unitary executive, historical gloss, Jerome Powell, Lisa Cook

Subject Category

Constitutional Law

Abstract

The case at the heart of the current controversy involves the President's firing of a Federal Reserve Governor against a backdrop of crumbling precedent. The backbone of administrative agency independence,Humphrey's Executor, awaits the Supreme Court's judgment. Therefore, distinguishing the Federal Reserve—responsible for controlling monetary policy and setting interest rates—has never been more pressing. This Note argues that the Federal Reserve can be meaningfully distinguished on a historical basis, as the Court suggests in Trump v. Wilcox, by reference to its family tree: the First and Second National Banks. Precedent and the fallout from lapses in the early National Banks persuaded skeptics of a centralized bank's institutional value. Looking to history, the persistence of a national bank, in one form or another, is at least highly suggestive of its necessity, if not dispositive. However, money matters–taxes, tariffs, coinage, monetary policy, interest rates–belong not to the Executive but to Congress, which alone holds the "power of the purse." This provides a principled carve-out for the Federal Reserve: it's in the money. A survey of past executive practice confirms the settled question of Federal Reserve independence. It cannot be true that Fed Governors can be removed by the President for cause without specification or no cause at all. The alternative would grant the Executive de facto control over monetary policy and interest rates.

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