Trump administration checking whether Federal Reserve chairman can be fired

· UPI

April 18 (UPI) -- White House economic adviser Kevin Hassett on Friday spoke about tariff negotiations, a budget bill and the Federal Reserve on the day Wall Street was closed because of Good Friday.

Hassett, the U.S. National Economic Council director, told reporters at the White House, they are determining whether firing Federal Reserve Chairman Jerome Powell was an option.

He also said he expects the Republican-backed tax legislation, described as "one big beautiful bill" by President Donald Trump, will be passed by Congress this summer.

And he said there are more than 15 deals with trading partners after Trump paused reciprocal tariffs for 90 days, including harsher ones on more than 60 worst offenders.

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The Federal Reserve chairman said Wednesday the tariffs would most likely endanger the economy and boost inflation. Trump responded Thursday that Powell is "playing politics" by holding off on lowering interest rates. Powell said there is a delicate balance between lowering rates and keeping inflation low.

"If I want him out, he'll be out of there real fast, believe me," Trump told reporters in the Oval Office during a meeting with Italian Prime Minister Giorgia Meloni. "I'm not happy with him."

Powell's term ends in October 2026 but Trump wants him gone before then. Powell and legal experts say Trump doesn't have the authority to remove him. Trump appointed him during his first term in November 2017.

"The president and his team will continue to study that matter," Hassett said when a reporter asked if "firing Jay Powell is an option in a way that it wasn't before."

The Federal Reserve, which is the central bank of the United States, is designed to operate independently from government.

In his 2021 book, Hassett criticized Trump's 2018 threat to fire Powell, saying it "would have savaged the reputation of the Federal Reserve Board as an objective and independent manager of the nation's money supply. The credibility of the dollar would have been compromised. The stock market might have crashed."

On Friday, he said "I think that at that time, the market was at a completely different place and I was referring to the legal analysis that we had back then, and if there's new legal analysis that says something different, then it would be a different market response, as well."

Budget bill

Hassett was more certain of budget legislation being passed by both GOP-led chambers.

"The hope is that the tax bill will be passed by the summer, early summer and so things are moving very, very quickly," Hassett told reporters. "We expect probably to finalize the president's thoughts on the tax agenda, at least first thoughts, opening salvos, by sometime next week."

House Speaker Mike Johnson said he expects the bill to pass by Memorial Day.

Currently, there are differences between Senate and House Republicans on the bill, including extending trillions of dollars in expiring tax cuts from Trump's first term.

The GOP budget legislation helps support Trump's policies on energy, border and defense that include drastic spending cuts.

House Republicans last week approved a budget blueprint after it was passed by the Senate, before leaving for a recess. The two chambers must reconcile the differences.

Tariffs and trade

On another economic front, Hassett said Trump is negotiating trading deals amid new tariffs and planned ones.

Without naming nations or terms, Hassett described them as "really big, big steps forward."

Last week he said deals were close to closing but needed legal approval

"There's a bunch of offers that are really sensible offers, and they're coming from our top trading partners," Hassett told CNBC last week.

If other countries remove tariffs on the United States, Trump would do likewise, Hassett said.

"So, I think that this system that the president set up to say, 'Hey, we're serious about negotiation. We're serious about reciprocity,''' the White House economist said.

"If you guys come down, we'll come down to do that."

Trump has said the United States has been treated unfairly and believes the tariffs will spur manufacturing in the nation.

"I think we're going to do even better this time, because you will see that the numbers that we're taking in are astronomical," Trump told reporters in the Oval Office on Thursday. "We're taking in a tremendous amount of money with the tariffs.

"We were treated very unfairly and the countries are having a hard time getting used to the fact that they can't do that to us anymore because we have a real president. We have a president that understands what it's all about."

A 10% baseline tariffs enacted earlier this month remains for most trading partners.

China's reciprocal tariffs were not removed like other countries. It has been slapped with a 145% duty. Last week, the higher rates on electronics, including cellphones, was paused.

China related with a 125% tariff.

On Friday, Ford stopped shipping vehicles to China. Last year the U.S. automaker sent 5,500 vehicles from U.S. plants to China, which is below 20,000 a year during the previous decade.

About 46% of cars sold in the United States are made in other countries. The tariffs are on parts.

On April 9, the 27-member European Union enacted retaliatory tariffs of $24 billion on products, including orange juice, soybeans and motorcycles. But the "countermeasures can be suspended at any time, should the U.S. agree to a fair and balanced negotiated outcome," the EU said in a statement.

Trump's had imposed a 20% retaliatory rate.

Other paused ones include Cambodia, hit with 49%, and Vietnam at 46%.