Lisa Cook is no stranger to attacks from the right.
As the Federal Reserve governor prepares for a high-stakes legal clash with President Donald Trump, where the future of the central bank’s independence is potentially at risk, her allies see echoes of the grueling Senate confirmation hearing that led to her becoming the first Black woman to join the Fed three years ago.
“They questioned her background, they questioned her expertise, they questioned whether she was qualified to serve,” said Lisa Rice, the president and CEO of the National Fair Housing Alliance, who pushed to rally support for Cook’s nomination. “She was a target. And she's still a target.”
Trump and top administration officials say Cook defrauded mortgage lenders by providing false information on lending documents. Those allegations, which were first surfaced by Federal Housing Finance Agency Director Bill Pulte, are now the subject of a Justice Department probe. Trump said “deceitful and potentially criminal conduct” provided “sufficient cause” for his stunning decision to fire Cook on Monday night.
She has vowed to fight, saying the president has no legal authority to dismiss her and that “no cause exists under the law.” In an earlier statement, Cook said she was “gathering the accurate information to answer any legitimate questions” about her mortgage history.
To Cook’s friends, this is all a pretext for Trump to grab power over the Fed and inflict collateral damage on a policymaker who has few Republican allies.
“I'm sure she sees what's going on here. This isn't about mortgages, this is about compromising the independence of the Fed,” said Jared Bernstein, a former top economic adviser to President Joe Biden, who nominated Cook for the Fed post.
“This is someone who spent a career showing the economic destruction, the economic costs of systemic discrimination by excluding groups from commerce and innovation,” Bernstein added. “The point of her work is that you need strong institutions to prevent that kind of abuse. Ironically, Trump is trying to cut off one of those very institutions at the knees.”
Representatives for the White House and Cook did not respond to requests for comment.
Cook, a former Michigan State University professor who studied racial injustice in the economy, faced a brutal path to the job in 2022 when Biden picked her for the role. Senate Republicans attacked her as unqualified and blasted her as a symbol of what they said was the Fed’s new “woke” direction. Sen. Bill Hagerty, a Tennessee Republican and Trump ally, said during the confirmation hearing that her published work seemed “more like social science than it does economics and monetary policy.”
During the hearing, Cook said she was “the target of anonymous and untrue attacks on my academic record.” She also defended her earlier work on “managing financial crises” as well as her published study on banking reform and recognizing systemic risk.
Her nomination became a flashpoint for a fight between progressives and Republicans over the proper role of the Fed, and the extent to which the central bank should engage in efforts to address issues like racial inequality and climate change.
Cook's background includes a three-year fellowship at the Hoover Institution — a conservative think tank that’s also on the resume of Trump allies like National Economic Council Director Kevin Hassett and former Fed Gov. Kevin Warsh — both on the president's short list to become the next Fed chair. Her output includes research on the economic effects of segregation and gender disparities in the labor market.
To GOP lawmakers — led by then-Sen. Pat Toomey (R-Pa.) — that history suggested she would push the Fed outside its narrow monetary policy mandate to address the political preferences of the Biden administration. Toomey blasted what he called Cook’s “extreme left-wing political advocacy” and said she was “grossly unqualified to serve on the Fed.”
That was part of what Cook allies involved in her confirmation battle recalled as an unusually vitriolic fight. The American Accountability Foundation — a conservative opposition research firm — solicited criticism from Cook’s colleagues at Michigan State in a bid to undermine her nomination. Top Republicans hammered her with attacks claiming she lacked monetary policy expertise.
Nevertheless, after being confirmed with a razor-thin margin — Vice President Kamala Harris was forced to break the Senate’s 50-50 tie — Cook consistently voted with Fed Chair Jerome Powell to keep rates elevated for the bulk of Biden’s remaining time in office, defying progressives who had pushed for the Fed to lower interest rates as the post-pandemic inflation surge faded.
More recently, she has also voted alongside Powell, Vice Chair Philip Jefferson and two Trump appointees, Govs. Michelle Bowman and Christopher Waller, to begin the process of scrapping Biden-era fair lending policies and to end the central bank’s participation in an international climate change group.
Democrats, in large part, are rallying around Cook, rejecting Trump’s allegations against her as baseless. And American Oversight, a left-leaning watchdog group, sought to go on offense against Pulte, suing the housing regulator to force the release of the records underlying his allegations of mortgage fraud against Cook. The group, and other Democrats, have accused Pulte of weaponizing his agency to advance Trump’s policy goal of reshaping the Fed board and lowering interest rates.
But one Cook ally — who was granted anonymity to speak frankly about her confirmation process — said the economist often relied on her existing networks rather than casting a wide net to amass support. If that was a challenge for her before joining the Fed, it’s likely more so now.
The central bank’s determination to remain apolitical creates special tests at moments when it’s under attack. Trump’s fury at Powell, Cook and other Fed officials for their refusal to lower interest rates — largely out of concern that tariffs could reignite inflation — can’t be countered at the same volume.
"The work that the Fed does is inherently unpopular politically at moments where inflation pressures are rising. That's just the nature of the institution,” said Lael Brainard, a former Fed vice chair who later served in Biden’s administration. “It's a very unbalanced discourse.”
Comments