'Bulls-eye on that person's back': Trump's attempt to sabotage top official could backfire

Federal Reserve Chairman Jerome Powell and President Donald Trump have been at odds with each other since the start of his second term. But Trump's attempts to drive him out of his role may end up doing more harm than good.

That's according to a Wednesday article in the Wall Street Journal, which reported that Trump is contemplating naming Powell's successor ahead of schedule (Powell's term ends in 2026 but he doesn't have to leave the Federal Reserve until 2028) as a means of undermining his authority. One leading contender is Kevin Warsh, who was on the Federal Reserve Board of Governors during President George W. Bush's administration. Warsh hasn't said whether he would ultimately accept a possible appointment to chair the nation's central bank, but he did characterize naming an early replacement as a way to "try to make a lame duck lamer."

“My fatal flaw is I say what I believe,” Warsh said during a recent Q&A session. “If the president wants someone who is weak, I don’t think I’m going to get the job.”

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However Trump proceeds with naming Powell's replacement, it could end up creating an even bigger headache for both Trump and the person he nominates. Economist Douglas Rediker told the Journal that Trump shouldn't assume that his chosen candidate would ultimately end up leading the Fed.

"The earlier Trump names his pick, the bigger the bull’s-eye on that person’s back, and the less likely that that person is the actual successor to Powell," he said.

Trump and Powell (who he appointed in his first term) have butted heads repeatedly over interest rates, with Trump repeatedly pressuring the Fed chair to lower borrowing rates, while Powell maintains that lowering rates too soon could cause inflation to spike. The president's frustration with Powell boiled over earlier this week, with Trump suggesting during a press conference that he may appoint himself to the Fed in order to set monetary policy himself.

"All I want to do in what’s left of my time at the Fed is to have the economy be strong and have inflation be under control,” Powell said during a congressional hearing this week. “I want to turn it over to my successor in that condition ... That’s the only thing I think about.”

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Click here to read the Journal's article in its entirety (subscription required).