Recently, the Supreme Court released two major executive power opinions. First, in Trump v. Slaughter, the Court held the Constitution vests the whole executive power in the President alone, yet in Trump v. Cook, it said the Fed can exercise executive power independent from presidential control. Chief Justice Roberts wrote both opinions, donning the robes of the Wonderful Wizard of Oz.
In August 2025, President Trump attempted to fire Lisa Cook over an alleged mortgage fraud scandal. Cook argued the action violated the Federal Reserve Act’s “for cause” protection and the requirement of process under statute and the Constitution. A district court issued a preliminary injunction blocking the removal. On Monday, the Court decided on its interim docket to keep the injunction in place, by a vote of 5-4. Justices Kavanaugh, Kagan, Sotomayor, and Jackson joined Chief Justice Roberts in ruling against Trump’s decision, with Justices Thomas, Alito, Gorsuch, and Barrett dissenting.
Despite the Federal Reserve’s indelible influence on the American economy since its creation in 1913, the Supreme Court has decided notably few cases on the bank’s legality. Beyond a pair of 1920s decisions confirming that banks are entities arising under federal law, the Court has avoided the question of what exactly the Fed is for the purposes of federal and constitutional law. As Cook wound its way through the lower courts, the justices hinted in Trump v. Wilcoxearlier this year that the Fed stands apart from other agencies due to its “uniquely structured, quasi-private” character and historical lineage, though they still permitted the president to remove officials from federal agencies.
This double standard between the Fed and other agencies continues. Earlier, the Court decided Trump v. Slaughter, overruling a 90-year-old precedent called Humphrey’s Executor and allowing the president to remove heads of administrative agencies at will. Writing for a majority that included the four dissenters in Cook, Chief Justice Roberts said “those who fall within the President’s ‘general administrative control’ must be removable by the President at
will.”
Yet, when applying his logic to the Fed, the Chief Justice sang a different tune. The Fed is different, the majority says, because it is a historically-unique institution. Chief Justice Roberts recounts the nation’s tradition of central banking, tracing it back to the Bank of North America and the First and Second Banks of the United States. “America has always had a central bank,” Roberts writes, and the “Federal Reserve follows in this lineage.” The historical pedigree and quasi-private character of the Fed, the majority concludes, justify its independence even as the Court rules against independent agencies elsewhere.
Responding to the Court’s pretzel-twisting inconsistencies, Justices Thomas, Alito, and Barrett wrote dissents. Last week, Justice Thomas became the first justice to quote Murray Rothbard last week, doing so again in the birthright citizenship case. He continued to add Rothbardian sentiments to the US Reports with his history of the Federal Reserve. The First and Second Banks of the United States “were banks with no executive power,” he explains, whereas the modern Federal Reserve Board is “unquestionably a federal agency that wields considerable executive power,” including issuing legal rules, levying assessments, banning individuals from banking, and enforcing statutes through civil and criminal penalties. Quoting Woodrow Wilson, Thomas calls it a “novel ‘federal agency’ with ‘broad powers affecting the entire banking and currency system.’” Although Justice Thomas weighs the enormity of this power against the Fed, that influence almost surely saves it from more exacting scrutiny.
As the Chief Justice himself admits, the primary reason the Fed receives the Court’s approval is the fear of “the calamities that could arise from even the ‘suspicion’ of political manipulation of monetary policy.” Too many economic problems would follow a ruling to the contrary, the Court seems to say. This pragmatic reasoning is predictable yet backwards.
To copy Justice Thomas’s and quote Murray Rothbard in The Case Against the Fed, “if the public knew what was going on, if it was able to rip open the curtain covering the inscrutable Wizard of Oz, it would soon discover that the Fed, far from being the indispensable solution to the problem of inflation, is itself the heart and cause of the problem.” Constitutional scholars have questioned whether the modern Fed’s structure truly aligns with original understandings of executive power, but revealing the Wizard is a task ill-suited to a Court that suffers many of the same problems.
Much like the Fed, the justices, led by the Chief Justice, often function as Wizard of Oz figures—projecting authority from behind their black robes while wholly unable to enforce them. Famously lacking “force or will,” the Court relies on its legitimacy as an institution to operate; the Fed, fiat currency.
