Bailing out the big banks. Manufacturing bubbles. Fueling 40-year high inflation. Delivering the highest interest rates in decades. Hemorrhaging cash. The track record at the Federal Reserve has been so poor that people are growing increasingly frustrated with the century-old institution. Surveys suggest Americans have little faith in Fed Chair Jerome Powell, and
a major overhaul at the Eccles Building might be required to restore public confidence in the US central bank.
This past month, two key surveys were released, revealing what the American people think about the Federal Reserve System and the central bank chief.
Second, a YouGov/CBS News poll found that 52% of US adults trusted the Fed to keep the United States out of a recession. By comparison, 26% responded “not at all” and 21% were “not sure.” Additionally, just 45% of respondents said they trusted the Fed to handle the US economy, and 29% said they were “not sure.”
At the post-Federal Open Market Committee policy meeting press conference, Powell was asked about these polling numbers. “Our response is we’re going to do everything we can to use our tools to achieve the goals that Congress has given us, and we’re not going to get distracted by anything,” he said. “So I think that’s what we’re going to do. We’re going to keep doing our jobs.”
In his opening remarks at every press conference, Powell routinely states that the Fed’s mission is to help the American people with stable prices and maximum employment – the dual mandate. But have monetary policymakers successfully lived up to their public endeavor? The data says no.
The current administration might not necessarily drain the Swamp, but the White House could be overhauling the nation’s capital. One way has been to target the Federal Reserve ecosystem.
One individual at the forefront of this crusade has been Treasury Secretary Scott Bessent. For months, Bessent has taken numerous shots at the central bank, arguing that the Fed’s problems extend beyond just Chair Powell. It is the entire thing that needs a comprehensive review.
Bessent recently wrote an essay titled “The Fed’s New ‘Gain-of-Function’ Monetary Policy,” an in-depth and sharp critique of the Eccles Building that has strayed from its congressionally authorized dual mandate. Despite critics warning that President Donald Trump’s actions are eroding central bank independence, Bessent contends that the Fed has done this itself.
“The Fed’s new operating model is effectively a gain-of-function monetary policy experiment,” he wrote. “Overuse of nonstandard policies, mission creep, and institutional bloat are threatening the central bank’s monetary independence.” He also delivered the best lines of his widely shared op-ed: “The Fed simply does not comprehend how the new gain-of-function monetary policy works,” adding that the Fed’s actions have resulted in “socialism for investors, capitalism for everyone else.”
Some Republicans in Congress are considering making changes. House GOP lawmakers reintroduced legislation called the Price Stability Act of 2025, which aims to alter the dual mandate, ensuring that the Federal Reserve exclusively focuses on controlling inflation in the US economy.
Will this be enough? It could be the start of something big.
Whether there is appetite on Capitol Hill to engage in the lengthy and arduous process of reforming the Fed remains to be seen. But this is the first time in many decades that an administration has taken seriously the idea of conducting a regime change in ideas, research, personnel, economic models, and monetary and regulatory policy decision-making at the creature of Jekyll Island.