WASHINGTON – US Treasury Secretary Scott Bessent on September 5 urged for an “independent, nonpartisan review” of the Federal Reserve, criticizing its expanded mission and warning about risks to its independence.
Writing in the Wall Street Journal, Bessent emphasized that the Fed’s credibility and political legitimacy have been compromised by venturing beyond its core mandate of maximum employment, stable prices, and moderate long-term interest rates. He called for the central bank to reaffirm its focus solely on these statutory goals.
Bessent’s remarks come amid increased pressure from President Donald Trump’s administration on the Fed’s policies, including a recent move to fire a Fed governor, raising concerns about political interference.
The Treasury Secretary also criticized the Fed’s regulatory role over banks, citing conflicts of interest in the institution’s oversight, lending, and profitability decisions. He proposed that other regulators, such as the FDIC and the Office of the Comptroller of the Currency, take the lead in bank supervision.
Bessent added that unconventional policies like quantitative easing should be reserved for emergencies and coordinated with the federal government.