Senator Moreno Alleges $400 Billion Annual Cost from Powell's "Partisan" Fed Policies, Calls for Removal

WASHINGTON, D.C. – Senator Bernie Moreno (R-OH) publicly accused Federal Reserve Chair Jerome Powell of partisan behavior and costing the United States $400 billion annually by maintaining high interest rates, advocating for Powell's immediate removal. The pointed criticism came during a Senate Banking Committee hearing on June 25, where Moreno asserted that homeowners, businesses, and credit card holders are suffering due to the Fed's current monetary policy.

Moreno directly challenged Powell, stating, "One man—Jerome Powell—is costing this country $400 billion a year. Homeowners, businesses, credit card holders, all suffer because he has a personal beef with the president. I’ve advocated for his immediate removal. He’s a partisan. This guy needs to go." This statement, amplified by Laura Ingraham on social media, reflects growing Republican discontent with the Fed's stance on interest rates and its perceived impact on the economy.

The Ohio Senator's remarks echo sentiments from former President Donald Trump, who has also frequently criticized Powell and suggested his replacement. Moreno specifically linked Powell's reluctance to cut rates to a "political lens" rather than a fiscal one, particularly in relation to the economic effects of tariffs. Powell, however, has consistently maintained that the Federal Reserve's decisions are independent of political considerations, focusing solely on its dual mandate of maximum employment and price stability.

High interest rates significantly increase the federal government's borrowing costs. The Committee for a Responsible Federal Budget has noted that the federal government currently spends approximately $400 billion on net interest expenses, a figure projected to rise substantially in the coming decade. This burden on the national debt is a key point of contention for critics like Moreno.

For American households and businesses, elevated interest rates translate into higher costs for borrowing. Credit card interest rates have reached record highs, with average APRs climbing to around 23%, contributing to total credit card debt surpassing $1 trillion. Businesses face challenges in renegotiating maturing debt at significantly higher rates, potentially impacting expansion plans and leading to increased bankruptcies or layoffs. Homeowners also experience higher mortgage rates, making home purchases and refinancing less affordable. The Fed's current policy aims to curb inflation, which remains a primary concern for the central bank, but critics argue the economic strain on consumers and businesses is too severe.