Federal Reserve Governor Stephen Miran's dissent during Wednesday's FOMC meeting has drawn mixed reactions from economists and politicians alike.
Trump’s ‘Sock Puppet’ At The Fed
Miran, who serves as the chair of the Council of Economic Advisers, was only appointed to the central bank last week, and during his first Federal Open Market Committee meeting, he cast the only dissenting vote in favor of a half-percentage-point interest rate cut, as opposed to the Fed’s 25 basis point cut.
In a post on X, Sen. Elizabeth Warren (D-Mass.) slammed Miran’s move, accusing him of trying to advance President Donald Trump’s agenda from inside the Federal Reserve.
She said, “Stephen Miran [is] not beating allegations that he is Donald Trump’s sock puppet at the Fed,” following the meeting.
Two weeks ago, during the Senate Banking Committee hearing led by Warren, Miran was specifically asked if he was “Donald Trump’s puppet,” to which he responded, saying, “not at all.”
Dissension Was ‘Intended To Send A Signal’
Economist Justin Wolfers echoed Warren’s views, saying that Miran’s move had more of a symbolic, rather than a practical consequence, during his appearance on MSNBC.
“Stephen Miran’s dissent on the Fed vote had no effect on interest rates,” Wolfers said, adding that it “was surely intended to send a signal,” which he said was to show the world that he was “Trump’s boy at the Fed.” Wolfers also highlighted that it is “very unusual to dissent in your first meeting,” like Miran has done.
Voting Pattern Bodes Well For Fed’s Independence
Economist Jason Furman, former chair of the Council of Economic Advisers under President Barack Obama, emphasized the importance of diversity of opinion inside the Fed while cautioning against political influence.
“Avoiding groupthink is great,” he said, while adding that he hoped “all of those dots, including that outlier at the bottom calling for five cuts at the next two meetings, reflect independent thought and not orders.”
Furman also pointed to the absence of dissent from other Trump appointees, such as Governors Michelle Bowman and Christopher Waller, suggesting the central bank may be holding its independence intact. “I’m thrilled to see that there wasn’t a partisan-appointment pattern of dissent this time,” he said, adding that it “bodes well for the Fed’s independence.”
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