- Donald Trump and his allies have been accused of executing a pattern of “lawfare,” akin to tactics employed by authoritarian regimes, by targeting political opponents with allegations of mortgage fraud.
- The latest target in this strategy is Federal Reserve governor Lisa Cook, who Trump is threatening to fire.
- Cook, the first Black woman appointed as a Fed governor, was appointed in 2022 by Joe Biden. Her term is set to expire in 2038.
- Bill Pulte, heir to a construction fortune and current head of the Federal Housing Finance Agency, has been leading the charge, publicly accusing Trump’s opponents of owner-occupancy fraud.
Why it matters: The use of legal challenges has raised concerns among political experts about the selective application of the law and the weaponization of legal mechanisms to intimidate political opponents.
What they’re saying:
- “The fact that the law is being selectively applied underlines that this is part of a pattern of lawfare,” said Don Moynihan, a professor of public policy at the University of Michigan. “What we are seeing is the type of weaponization we associate with authoritarian regimes.”
- “Anyone who engages in criminal activity should be held accountable. No one is above the law,” remarked a White House official.
- Cook has stated she has “no intention of being bullied to step down from my position.” She reiterated her commitment to transparency, stating she is gathering information to address any legitimate questions.
The background: Cook’s position on the Federal Reserve board, which sets interest rates, has likely made her a target. Trump has been vocal about his dissatisfaction with the Fed, demanding rate cuts that the board, including Cook, has resisted.
The stakes: This ongoing situation highlights the tension between the Trump administration and the Federal Reserve, as well as raising broader concerns about the use of legal mechanisms to intimidate political opponents.
As of Sunday night, National Guard troops operating in Washington, D.C., are now armed, according to a defense official.
Why it matters: The arming of National Guard troops in the nation’s capital underscores the heightened security measures being taken in response to ongoing tensions and potential threats.
The details:
- The order will apply to the more than 2,200 guardsmen from D.C. and other states currently serving in the mission in D.C.
- Soldiers will be equipped with service-issued weapons, which may include M-17 pistols or M-4 rifles.
- Task force personnel operate under established Rules for the Use of Force, which allow the use of force only as a last resort and solely in response to an imminent threat of death or serious bodily harm.
What’s next: Planning is also underway at the Pentagon for the potential use of National Guard forces in Chicago, according to a U.S. official.
In the face of the Trump administration’s recent mortgage fraud allegations against Federal Reserve Governor Lisa Cook, current and former Federal Reserve officials have spoken out in her defense, underscoring the importance of the central bank’s independence.
Why it matters: The unfolding saga highlights the critical balance between governmental influence and the independent operation of a central banking system.
What they’re saying:
- “Until there’s some facts out, I don’t think people should draw any conclusion,” said former Boston Fed President Eric Rosengren.
- “I have no intention of being bullied to step down from my position because of some questions raised in a tweet,” asserted Cook.
- “I think it’s critically important that the Fed maintains its independence so we can ensure great outcomes for the American public,” stated Cleveland Fed President Beth Hammack.
The stakes: These developments have raised concerns on Wall Street about the Fed’s independence. Trump has consistently criticized the Fed’s interest rate policies and has expressed his intent to replace Chair Jerome Powell before his term ends in May 2026.
The bottom line: Former Fed Vice Chair Roger Ferguson emphasized the necessity of the Fed’s independence to control inflation and affirmed the negative global consequences of undermining central bank independence.
