Kevin Warsh, Trump’s Fed Chair Pick, Faces Skepticism Over Claim of Independence

Kevin M. Warsh, President Trump’s pick to lead the Federal Reserve, asserted repeatedly at a combative confirmation hearing on Tuesday that he would not cut interest rates simply because President Trump wanted him to, pledging to be “strictly independent” if confirmed for one of the world’s most powerful economic positions.

In sometimes testy exchanges before the Senate Banking Committee, Mr. Warsh, 56, sought to dispel doubts around his credibility, saying Mr. Trump had “never asked me to predetermine, commit, fix, decide on any interest rate decision in any of our discussions, nor would I ever agree to do so.”

He was repeatedly asked if he would function as a “sock puppet” for Mr. Trump, who has demanded lower rates from the Fed and attacked the institution’s top leadership for failing to cut them aggressively enough. Just hours before the hearing, Mr. Trump said in an interview with CNBC that he would be “disappointed” if Mr. Warsh did not reduce borrowing costs once confirmed as Fed chair.

Mr. Warsh, who served as a Fed governor from 2006 to 2011, said he would remain independent. In his opening statement, he said that central bankers must be “strong enough to listen to a diversity of views from all corners, humble enough to be open-minded to new ideas and new economic developments, wise enough to translate imperfect data into meaningful insight and dedicated enough to make judgments faithfully and wisely.”

But as several lawmakers on Tuesday noted, Mr. Trump’s broadsides against the Fed have gone well beyond just verbal arguments. He is in the midst of trying to remove Lisa D. Cook, a governor appointed by the Biden administration, from her position over unsubstantiated allegations of mortgage fraud. The Supreme Court has yet to rule on the case, but so far the justices seem wary about allowing Ms. Cook’s ousting to hold given concerns about the Fed’s independence.

The Justice Department has also initiated a criminal investigation into Mr. Powell and his handling of renovations at the Fed’s headquarters in Washington, which has thrown a wrench into Mr. Warsh’s ability to get confirmed before Mr. Powell’s term as chair ends on May 15.