The Federal Reserve as we know it could soon be turned on its head

Since its forma

For over 70 years, the US central bank has operated as an independent government agency. When officials meet to decide where interest rates should be, they don’t consult the president and other elected officials — and for good reason. That’s because, as one former Federal Reserve chair famously said, central bankers’ job is to remove the punchbowl right when the party is just getting started. Said differently, they have to make unpopular decisions that ultimately seek to benefit the economy in the long run. But the Fed’s independence could be compromised once President-elect Donald Trump returns to the White House. “I feel the president should have at least a say in there. I feel that strongly,” Trump said at a press conference in August, referring to the Fed’s interest rate decisions. “I made a lot of money. I was very successful. And I think I have a better instinct than, in many cases, people that would be on the Federal Reserve — or the chairman.” It’s unclear if Trump, or any president, could take the Fed’s independence away on his own or if it would require congressional approval. Representatives from the Trump campaign did not respond to CNN’s request for a comment, while a Fed spokesperson declined to comment. After a barrage of backlash, Trump sought to soften his prior comments. “A president certainly can be talking about interest rates because I think I have very good instincts,” Trump said in a Bloomberg News interview less than two weeks after he claimed he deserved a say. “That doesn’t mean I’m calling the shot, but it does mean that I should have a right to be able to talk about it like anybody else.”