President Donald Trump presided over the White House swearing-in of Kevin Warsh as the new Federal Reserve chair on Friday, offering rare public approval while urging economic independence. The ceremony, held in the East Room rather than at the Fed’s headquarters, signaled Trump’s endorsement of Warsh’s leadership.
Trump, who spent months criticizing Warsh’s predecessor, Jerome Powell, for reluctance to cut interest rates, expressed confidence in Warsh’s ability to stimulate economic growth. "Thankfully, unlike some of his predecessors, Kevin understands that when the economy is booming, that’s a good thing," Trump said. "We want it to boom."
Fed Independence Under Scrutiny
The event raised questions about the Fed’s independence, as Trump has historically pressured the central bank to align with his economic agenda. In a nod to these concerns, Trump stated, "I want Kevin to be totally independent. Don’t look at me, don’t look at anybody. Just do your own thing." However, he added that the Fed had "lost its way" under Powell’s leadership.
"These years can bring unmatched prosperity that will raise living standards for Americans from all walks of life," Warsh said in his remarks.
Warsh, a critic of the Fed’s pandemic-era policies, has argued that artificial intelligence-driven productivity gains could enable rate cuts without spurring inflation. However, many Fed officials remain skeptical, citing AI’s potential to disrupt labor markets and exacerbate job losses.
Supreme Court Justice Clarence Thomas administered the oath of office, with House Speaker Mike Johnson, Justice Brett Kavanaugh, and CIA Director John Ratcliffe in attendance. Trump predicted Warsh would go down as "one of the truly great chairmen of the Federal Reserve."
As Warsh takes the helm, the Fed faces mounting challenges, including inflationary pressures and geopolitical instability. The White House ceremony underscored Trump’s expectations for economic revitalization under Warsh’s leadership.