Bessent on Fed says: There must be an honest, independent, nonpartisan review of entire institution, including monetary policy, regulation, communications, staffing and research-WSJ

Bessent on Fed says: There must be an honest, independent, nonpartisan review of entire institution, including monetary policy, regulation, communications, staffing and research-WSJ

U.S. Treasury Secretary Scott Bessent has called for an honest, independent, and nonpartisan review of the Federal Reserve, encompassing its monetary policy, regulation, communications, staffing, and research. Bessent made these remarks during an interview at a diner in suburban Washington, where he emphasized the need for a thorough examination of the institution's operations [1].

"The Fed should be independent," Bessent stated, "but I also think that they've made a lot of mistakes." Bessent's comments come amidst ongoing criticism from President Donald Trump, who has repeatedly criticized the Federal Reserve and its chair, Jerome Powell, for not lowering interest rates [1].

In addition to monetary policy, Bessent's review would also encompass the Fed's regulatory and communication practices, staffing, and research activities. This comprehensive evaluation is aimed at ensuring the Fed operates in the best interests of the American public and the broader economy. Bessent's call for a review is a significant step towards addressing concerns about the Fed's independence and effectiveness [1].

The Federal Reserve has long been considered one of the most independent and powerful institutions in the United States. However, recent political pressures and public scrutiny have raised questions about its decision-making processes and the extent to which it should be subject to political influence. Bessent's proposal for a review is intended to address these concerns and to ensure that the Fed continues to function as a nonpartisan institution [1].

While Bessent's call for a review is a significant development, it remains to be seen how the Federal Reserve will respond and what form the review will take. The Federal Reserve has traditionally operated with a high degree of independence, and any review of its operations will need to be conducted in a way that respects this independence while also addressing legitimate concerns about its effectiveness [1].

In summary, Treasury Secretary Bessent's call for an independent review of the Federal Reserve is a response to ongoing criticisms and a recognition of the need to ensure the institution's operations are in the best interests of the American public. The review will encompass a wide range of aspects of the Fed's operations and is intended to address concerns about its independence and effectiveness.

References:
[1] Reuters. (2025, September 1). Fed should be independent, has made mistakes, says U.S. Treasury Secretary Bessent. Retrieved from https://www.reuters.com/world/us/fed-should-be-independent-has-made-mistakes-treasury-secretary-bessent-says-2025-09-01/