'So Very Wrong': Nancy Pelosi Warns Trump Planning To Replace Powell With 'Party Hack' As Fed Chair

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On the House floor, Speaker Emerita Pelosi decried President Trump's attacks on Fed Chair Jerome Powell.

Transcript

00:00From California, Ms. Pelosi for five minutes.

00:04I ask your amendment to consent to address the House for five minutes and two.

00:08Without objection.

00:13Mr. Speaker, I rise today in strong support of one of the bedrock principles of our economy,

00:20the independence of the Federal Reserve Board.

00:23For more than a century, the Federal Reserve has served as a cornerstone

00:27of the economic system of our country, taxed with safeguarding price stability,

00:33maximizing employment, preserving the health of our country,

00:37independent from political pressure, insulated from partisanship,

00:42and rooted in data and principle.

00:44When I first came to Congress, Mr. Speaker, I was a member of what was then called

00:48the Banking, Housing, and Urban Affairs Committee, now Financial Services.

00:53And at that committee, as it is today under the new name,

00:56we heard from the chair of the Fed on a specific amount of time required by Congress

01:03on two subjects.

01:05According to the Humphrey-Hawkins law, they would report to us on inflation,

01:12and they would report on unemployment.

01:15Employment, unemployment.

01:17And that was their part of the purview in their communication with Congress

01:21that was required on a regular basis.

01:23We heard, I heard one of the chairs of the Fed say,

01:27unemployment is dangerously low, scared me to death.

01:30How could it be?

01:31But he was reporting as to its impact on inflation.

01:36One thing when I, that was when I was a new member,

01:38when I was Speaker, I said to our members who said frequently,

01:42why don't we have the Fed be more accountable?

01:45To us, I said it has to be independent.

01:48They have their own funding.

01:50They don't have to come depend on us for that because their independence is essential.

01:56Any of us who had economics in college or beyond knows that independence of the Fed

02:02is essential to the respect that our country commands in terms of our own economy throughout the world.

02:10The chairman of the Fed is the chair of the central banks,

02:13serves as a chair of the central banks globally,

02:17and it can't be a party hack.

02:20It can't be somebody who's there because the president wants to create interest rates.

02:29That's not what the president's job is, to create interest rates.

02:33It's the chairman of, it's the Federal Reserve Board that does that.

02:38So it's really important.

02:40And I come to you on this day to say this because of the rumors that we hear of the flirtation

02:47with making the Fed just a handmaiden of the presidency.

02:52It would be wrong, it would be wrong to do.

02:54It would be wrong to do, and we would be viewed disrespectfully if we were ever to go down that path.

03:02Now, this comes at a time when we are observing the 15th anniversary of the Dodd-Frank Wall Street Reform

03:12and Consumer Protection Act.

03:14As some of us here know who've served with Barney Frank,

03:18he was then a chair of the then Financial Services Committee

03:22and a master of his agenda there.

03:28And Senator Dodd from Connecticut was on the Senate side with that.

03:32It was necessary, Mr. Speaker, because of what was happening in the financial community.

03:39The banks were, I mean, it was awful.

03:42It was horrible.

03:43You all know that around, in September of 2008, we were told that our financial system was melting down.

03:53It was doing so because of, well, I've written about it in my book,

03:57and I won't go through the whole thing right now,

03:59but because of what was happening terribly in the financial system

04:05by the banks and financial services, financial institutions.

04:11What happened?

04:12Millions of people lost money, trillions of dollars from the wealth of the country,

04:20millions of people losing their jobs,

04:22so many losing their homes, losing their savings and the rest.

04:27So this bill was necessary.

04:29Of course, after the bill was passed, and to this day,

04:31still the banks and other financial institutions try to undermine it

04:36and weaken it and weaken it.

04:38The Volcker rule of former chair of the Fed had a provision in there

04:43for the security of our economic system.

04:47So these notions that they're putting forth of making the Fed a party chair, a party hack,

04:57it's just so very wrong, just so very wrong.

05:01And just say this, again, in school you probably learned a fiscal policy,

05:06and that's what the Congress of the United States does.

05:09We create the budget of the United States.

05:15And the monetary policy, fiscal here, monetary at the Fed establishing the rates

05:22in terms of relating to inflation.

05:24So let's rid ourselves, disabuse ourselves of notions,

05:30when instead we need serious ideas about how to make our economy work for the American people.

05:36Thank you, Mr. Speaker.

05:36Thank you, gentlemen.

05:37Thank you, gentlemen.

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