Lev Menand and Nathan Tankus on Why Fed Independence Is Now Hanging by a Thread
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What is the main topic discussed in this episode?
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Hello and welcome to another episode of the OddLots Podcast. I'm Traci Alloway.
And I'm Joe Weisenthal.
Joe, let me ask you a personal question.
Go on.
Is Alexander Hamilton always right?
I doubt it. I have not read the complete works of Alexander Hamilton. My main knowledge of Hamilton... Is it the musical? No, I was going to say my main knowledge of Alexander Hamilton is Christian Parenti's book, Radical Hamilton. But I've also watched the musical. And let me state at the outset my most controversial opinion. So when that musical came out, it was... A lot of people really liked it. And then a few years later, everyone's like, oh, this is lib and cringe. It's a good musical. And it's time for people to set aside everything else. It's time for people to accept that in the category of musical theater, which I get is not to everyone's tastes, and I have some strong opinions on how much of it is bad, it is an upper decile or upper quintile musical.
Hamilton being a great musical is going to be the most controversial opinion in this entire episode.
OK. That's right.
But the reason I bring it up is because a couple of things have happened recently with the US government. So we had a Supreme Court decision that basically turbocharged the president's ability to fire heads of agencies, right? And then we had another Supreme Court decision that basically carved out an exception for the Fed.
Right.
While – this is where Hamilton comes in. While citing the history and tradition of the independence of the central bank, Hamiltonian theory and all of that.
Right. Like I think a lot of people even before this decision – and we did some discussions about this – have this view. It's like the Fed is different because the Fed is different. Right. That it's like, yes, legally or sort of like on a formal written status, like why should it be different than the FCC or the FTC, et cetera, looks the same. But a lot of people have this intuition that the Fed is different because it's different. But when you're like making laws, right, you sort of have to write something down in theory to establish that in one of the things that was stated in the essentially decision so that Trump couldn't easily remove Lisa Cook, which was really all it said. Yeah. There was they sort of wrote down the thing that makes the Fed different.
And one of the things they say is like it has a tradition going back to Alexander Hamilton.
Right.
The Hamilton exception.
Right. And I mean, you know, on the one hand, I think you're right that a lot of people would argue that the Fed is different because the Fed does monetary policy and ostensibly you want an independent central bank. But on the other hand, the Fed does a lot of regulatory things that look a little bit more like an agency. So anyway. We're going to get into all the details of the case and what makes the Fed special, I guess, and why the president can now fire people at the FTC or the SEC, but not at the central bank. We have the perfect guests. We're going to be speaking with Lev Menand. He is, of course, a Columbia law professor who's been on a number of times before. He also just wrote a paper called The Federal Reserve Exception to the Slaughter Rule.
There we go.
Yep. And we're also going to be speaking with Nathan Tankus. He is the president of Notes on the Crises and has been writing a lot about the Fed and also government agencies more broadly.
And also a repeat guest.
Also a repeat guest.
Friend of the pod.
All right.
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Chapters
4 chapters
1
What is the main topic discussed in this episode?
0:00–9:21
2
What prompted the recent Supreme Court fights over agency removal powers?
9:21–28:24
3
How did Humphrey’s Executor shape the argument for agency independence?
28:24–57:45
4
Why do economists value central bank independence differently from administrative law?
57:45–1:07:48
Speakers
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