Wasch’s hearing: Using humor to defuse awkwardness, relying on ambiguity to cater to Trump—but how long can this last?

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At the Senate confirmation hearing held on Tuesday, Federal Reserve Chair nominee Waller dodged the core concerns about the Fed’s independence with evasive remarks, increasing market unease about the direction of U.S. monetary policy.

Bloomberg columnist Jonathan Levin wrote in an article that Waller attributed the main threat to independence to the Fed itself during the hearing. He claimed: "Elected officials expressing opinions about interest rates does not mean monetary policy independence is threatened." However, Trump has previously used the Justice Department to pressure the Fed leadership and repeatedly demanded rate cuts publicly on social media. Waller’s remarks are widely seen as deliberately downplaying the White House’s pressure tactics.

Waller’s evasive stance precisely reflects his structural predicament: once inaugurated, he will face a dilemma—either cut rates or become Trump’s next target. Evasive statements in the hearing might temporarily maintain relations with the White House, but this strategy is unlikely to last. Doubts over the Fed’s independence among investors are unlikely to fade in the short term.

Humorous Response to Disagreements, Dodging Rate Cut Questions with Jargon

Jonathan Levin states that the biggest highlight of Waller’s hearing was not what he said, but how skillfully he avoided substantive statements. Observers generally believe Waller constructed a “distorted rhetorical framework”—instead of directly responding to allegations that Trump interfered with the Fed’s independence, he pointed the finger at the Fed itself, claiming its ‘mission creep’ and ‘dereliction of duty’ undermine its own credibility.

This statement seemed rather odd to many. Trump did not merely ‘express opinions’; he used the Justice Department to threaten the Fed’s leadership and publicly demanded interest rates be cut to 1% or even lower on social media. In the face of this reality, Waller chose to sidestep the core issue with technical terminology.

When Democratic Senator Chris Van Hollen pressed whether it was reasonable to lower interest rates from 3.5% to 1% while economic growth is strong and inflation is above target, Waller cited concepts like “the interplay of interest rate policy and bond purchasing programs,” “the impact of artificial intelligence,” and “the long-term lag effect of monetary policy”—ultimately refusing to answer directly, saying, “I don’t believe in forward guidance.” The article points out, Waller clearly knows the answer—that a drastic rate cut in such economic conditions would be absurd; he just doesn’t want to admit it.

A more dramatic moment occurred when Senator Elizabeth Warren asked if he disagreed with Trump on any issue. Waller joked that his only disagreement was Trump’s claim that he was “born to be a central banker”—he himself believes if he were truly “born to be a central banker,” he should be “older, have grayer hair, and be smoking a cigar.” The joke was more awkward than humorous.

Bending Before Entering: Can Waller Stand Tall After Taking Office?

The Fed’s independence has always been seen as the ballast for global financial stability. The core logic is: monetary policy must be based on economic data, not political pressure. Once a central bank becomes the government’s “printing press,” the risks of runaway inflation and collapse of monetary credibility rise sharply. Yet Waller’s entire hearing rationale is shaking this ballast—by blaming independence issues on the Fed itself, he is building a “rationalizing” narrative for Trump’s intervention.

The deeper contradiction is that once Waller takes office, he will face an unsolvable dilemma: either bow to Trump’s pressure and cut rates, or stick to independent judgment and become the next target of criticism. The article gives a vivid metaphor: What Waller is doing now is like a person bowing deeply before entering a door, only to have to stand straight once inside—but after such bowing, does he still have the strength to stand tall?

The article concludes: We can only “hope that once he is safely confirmed and inaugurated, he will rediscover a passion for intellectual clarity, and the courage to push back against the President.”

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