The DOJ’s investigation is ugly politics, but we might welcome a test of whether central bankers are subject to the same oversight as everyone else.

The latest clash between President Trump, Federal Reserve Chair Powell, and the Department of Justice has been widely portrayed as a constitutional crisis for central bank independence. The DOJ is investigating whether Powell made false or misleading statements to Congress regarding the scope and cost of the Federal Reserve’s m ulti-billion-dollar headquarters renovation. Powell denies wrongdoing and casts the inquiry as political pressure on monetary policy. Trump denies direct involvement, but has renewed his longstanding attacks on Powell’s performance as Fed chair. The affair has metastasized into a broader fight over law, accountability, and the nature of modern central banking.

Financial markets have responded nervously. Commentators warn of capital flight, politicized interest-rate decisions, and the erosion of US monetary credibility. Former Fed officials and many academic economists have rushed to Powell’s defense, framing the investigation itself as the real scandal. International central bankers have issued statements of solidarity. The elite consensus is clear: even asking whether the Fed chair broke the law risks catastrophic damage to institutional independence.

But this framing obscures the main issue. It matters greatly whether Powell lied to Congress. Legislative oversight is not a nuisance; it is the constitutional mechanism by which unelected officials remain accountable to the public. If Powell’s testimony was accurate, the investigation should end quickly and publicly. If it was not, that fact cannot be waved away by invoking the supposed sanctity of central banking. Accountability is not optional simply because the Fed is prestigious.

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