Vance: Presidents Should Have Role in Deciding Monetary Policy

Republican vice presidential nominee U.S. Sen. J.D. Vance (R-Ohio) introduces U.S. Republican Presidential nominee former President Donald Trump during a rally at Herb Brooks National Hockey Center in St Cloud, Minn., on July 27, 2024. Stephen Maturen/Getty Images

Republican vice presidential candidate Sen. JD Vance (R-Ohio) on Aug. 11 reiterated former President Donald Trump’s calls for the president to have a role in deciding federal monetary policy.

During an Aug. 11 appearance on CNN’s “State of the Union,” Vance was asked by host Dana Bash about his running mate’s comments earlier this week.

Speaking about Federal Reserve policy, which has an economy-wide effect on almost all Americans, Trump opined, “The president should have at least a say in there.”

Asked about Trump’s comment, Vance made clear he “absolutely” agrees with the former president, framing the issue in terms of giving elected officials some say over the actions of those who run the Fed.

“President Trump is saying, I think, something that’s really important and actually profound, which is that the political leadership of this country should have more say over the monetary policy of this country,” Vance said. “I agree with him.

“That should fundamentally be a political decision. Agree or disagree, we should have America’s elected leaders having input about the most important decisions confronting our country.”

The president currently has no authority over the Fed’s decisions, which are left primarily to the chairman and board of the central bank. However, the chairman, vice chairs, and members of the board are appointed by the president and confirmed by the Senate.

During his first term in the White House, Trump criticized the Fed’s decisions to repeatedly raise interest rates, making borrowing more costly for Americans seeking credit. The Fed, chaired by Trump appointee Jerome Powell, continued to boost the rate for two years until the end of 2018, amid Trump’s protestations.

As of August, interest rates are sitting at 5.33 percent, the result of several increases by the Fed since 2021 to offset the effects of inflation.

Pushed by Bash, Vance acknowledged that giving the president input over Fed policy would represent a “huge change,” but he again framed it as a more democratic approach to monetary policy in the United States.

“Whether the country goes to war, what our interest rates are—these are important questions that American democracy should have important answers for,” Vance said.

“I think all President Trump is saying is, ‘Look, it’s kind of weird that you have so many bureaucrats making so many important decisions.’ If the American people don’t like our interest rate policy, they should elect somebody different to change the policy. Nothing should be above democratic debate in this country when it comes to the big questions confronting the United States.”

Trump made his remarks on the Fed two days before Vance’s interview aired.

During the same remarks, Trump suggested that the Fed has “sort of gotten it wrong a lot.”

“I think I have a better instinct than, in many cases, people that would be on the Federal Reserve or the chairman,” he said. “I used to have it out with [Powell]. I had it out with him a couple of times very strongly. I fought him very hard.”

A change in Fed policy to give the president more direct control over monetary policy would likely require new legislation, which could be difficult for Republicans to pass through the Senate if it faced substantial opposition from Democrats.

Under the Federal Reserve Act of 1913, which established the bank, the Fed exists in a state of limbo between public and private operation. Although it handles decisions related to the U.S. dollar, the Fed exists as an entity largely independent of the U.S. government.