A MARTÍNEZ, HOST:
While Senators clashed with Health Secretary Kennedy, more drama unfolded in another hearing room on Capitol Hill. President Trump's pick to fill a short-term opening on the Federal Reserve Board tried to assure lawmakers that he wouldn't be a puppet for the president when it comes to settling interest rates. Stephen Miran looks likely to win confirmation for the central bank job over Democrats' objections. Here's NPR's Scott Horsley.
SCOTT HORSLEY, BYLINE: By law, the central bank is supposed to make decisions on interest rates and other policies without political meddling from the White House. Trump nominee Stephen Miran says he's committed to that, even though he's currently a top economic adviser in the White House and hopes to return to that post early next year.
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STEPHEN MIRAN: I couldn't be more in agreement that independence of the central bank is of paramount importance for the economy, for financial markets, for the long run stewardship of the country.
HORSLEY: Senate Democrats are skeptical that Miran would really operate at arm's length from the president. Massachusetts Senator Elizabeth Warren says Trump has been relentless in his push to get the Fed to lower interest rates. At times, Trump has threatened to fire Fed Chairman Jerome Powell. He's also tried to fire another fed governor, Lisa Cook. Warren says that's the context in which Miran's nomination must be weighed.
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ELIZABETH WARREN: President Trump has conducted a monthlong campaign to seize control of the Federal Reserve.
HORSLEY: Economists widely agree that central banks work best when they're free to focus on long-term economic stability, even if that means making decisions that are unpopular in the short run, like keeping interest rates high to get inflation under control. History shows when central banks bend to political pressure for short-term gain, it often backfires. Warren pointed to that history during Miran's confirmation hearing.
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WARREN: It happened in the 1970s, when President Nixon bullied the Fed into keeping rates too low for too long and led to years of stagflation where both unemployment and inflation stayed high.
HORSLEY: Warren argues that deep down, her Republican colleagues know a presidential takeover of the Fed is, in her words, a recipe for disaster. Senate Republicans also nodded to the importance of an independent Fed but showed no sign of bucking the president. Miran appears poised for confirmation, possibly in time for the Fed's next decision on interest rates in less than two weeks.
Scott Horsley, NPR News, Washington. Transcript provided by NPR, Copyright NPR.
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