Analysis: If Trump succeeds in overturning Humphrey, he will have more room to fire the Fed chairman

Mars Finance News, on April 15th, recently, Trump urgently filed an application with the US Supreme Court, hoping the justices would grant him unrestricted dismissal rights. Blocking him is a precedent from Franklin Roosevelt's presidency - the "Humphrey's Executor v United States" case. In 1933, Roosevelt attempted to dismiss William Humphrey, one of the five commissioners of the Federal Trade Commission, due to policy disagreements and Humphrey's opposition to the "New Deal" plan. Humphrey sued Roosevelt, and although he passed away the following year, the Supreme Court ruled in his favor in 1935. For decades, the "Humphrey case" established a principle: the president does not have unlimited dismissal rights. This precedent protects the independence of administrative agencies established by Congress with "quasi-judicial" or "quasi-legislative" powers, such as the Equal Employment Opportunity Commission and the Securities and Exchange Commission. Following the spirit of the "Humphrey case", district courts ruled that Trump had no right to dismiss two officials appointed by Biden in 2021 and 2022: Cathy Harris (MSPB member) and Gwynne Wilcox (NLRB member). Since Trump provided no reasons and merely believed they would not support his policies, the court deemed his actions invalid. In the emergency application submitted to the Supreme Court, Trump's team claimed these court decisions were "untenable". The application stated that the president "should not be forced to hand over administrative power to agency heads who oppose government policies, not even for a day - let alone the months required for court proceedings". University of Virginia Law Professor Sai Prakash believes this "Trump v. Wilcox" case might completely end the legal status of the "Humphrey case". University of Chicago Law School's Will Baude also suggests the justices "will almost certainly" terminate the "Humphrey case". The Federal Reserve and its chair have never been entirely free from political influence, such as Nixon requesting Chairman Burns to lower interest rates before the 1972 election. Trump also regretted nominating Powell as Fed chair during his term. Recently, Trump stated he would not replace Powell before his term ends in May 2026 (his board term ends in 2028). However, if Trump becomes dissatisfied with Powell again and the "Humphrey case" is overturned, he would have more room to dismiss the Fed chair. (Jin Shi)