By Bryan Mena, CNN

Washington (CNN) — Stephen Miran, the White House economist President Donald Trump nominated to the Federal Reserve’s top ranks, just got an earful about the importance of the central bank’s independence — just as the Trump administration actively defends removing Fed Governor Lisa Cook from her post.

The Senate Banking Committee held a hearing Thursday to consider Miran’s nomination to fill a vacant seat on the Fed’s Board of Governors. It was a crucial step in Trump’s efforts to reshape the Fed, potentially eroding its long-accepted independence from politics, which in part has helped the US economy grow to and remain the world’s largest over the past century.

Republican and Democratic senators were unequivocal that the Fed’s decisions on interest rates should remain free of political considerations. Miran agreed at various points throughout the hearing, stating that central bank independence “is critical to the well functioning of the economy and financial markets.”

But Democrats questioned Miran’s ability to distance himself from Trump, should he be confirmed to become a Fed governor. Miran said Thursday he plans to technically remain an employee of the White House if he becomes Fed governor on a temporary basis.

He told lawmakers he would take a leave of absence from his current role as chair of the Council of Economic Advisers if his Fed term lasts only through January, but said he would resign if he remains for longer. He said he was advised to take that approach by legal counsel.

“You are going to be technically an employee of the President of United States, but an independent member of the board of the Federal Reserve. That’s ridiculous,” Democratic Sen. Jack Reed of Rhode Island said.

Meanwhile, less than a mile away from Capitol Hill, a federal judge is set to review new court filings from the Trump administration and perhaps rule as early as Thursday whether Cook, whom the president fired last week over allegations of mortgage fraud, can remain as a Fed governor while her lawsuit challenging Trump’s removal order moves forward in litigation.

Since the beginning of the year, the Fed has been subject to unprecedented attacks by the Trump administration because central bankers haven’t heeded the president’s demands to lower interest rates. Fed officials have stood pat since December because they’ve wanted to see how the US economy responds to Trump’s sweeping policies first, though they’re gearing up for a rate cut in two weeks.

Miran challenged by Democrats

Before doing a complete 180 on his views about Fed independence, Miran, a Harvard-trained PhD economist, had challenged it in the recent past.

Last year, Miran co-authored a Manhattan Institute report that called the Fed’s independence an outdated “shibboleth,” and he called for shorter terms for Fed governors to give the president more power to hold sway over the agency.

The paper also criticized the revolving door of leaders between the White House and the Fed. Some senators characterized Miran’s nomination as ironic.

Sen. Tina Smith of Minnesota said “given the nature of your current role and your expressed concern in mind for insulating the Fed board members from the day-to-day political process, I just don’t understand how your nomination doesn’t break the rule or the goal that you’ve set out yourself.”

In response, Miran said his paper simply laid out proposals to reform the Fed and that “it’s important that we have democratic oversight.”

“I’m very independently minded, as shown by my willingness to stray from consensus and have out-of-consensus views, and I believe that I will continue to be as independent in my thinking process, if confirmed,” Miran said.

In response to a question posed by Sen. Andy Kim of New Jersey, Miran said he hasn’t been asked by Trump or anyone in the administration to vote for lower interest rates if he’s confirmed.

Sen. Elizabeth Warren of Massachusetts, the committee’s Democratic ranking member, also criticized Miran for coming “from a highly political role to a non-political role.” At one point, she pressed him to state that Trump lost the 2020 election, which he refused to state outright.

Miran is also one of the main architects of Trump’s aggressive trade policy. In a November 2024 paper, Miran detailed how a tariff-centric approach, aimed at weakening the dollar, could reshape the global trading system in favor of the United States. But if confirmed to be a Fed governor, Miran would no longer play a role in shaping the administration’s fiscal and trade policy.

Fed Chair Stephen Miran?

There’s a chance Miran won’t just be a Fed governor.

When Miran’s nomination was announced, Trump said the appointment would last through January, aimed at filling the remainder of former Fed Governor Adriana Kugler’s term, who resigned in early August without citing a reason for her departure. Last week, Trump said he is considering a longer term for Miran.

“We might switch him to the other, it’s a longer term, and pick somebody else,” Trump said during a Cabinet meeting on August 26, referring to Cook’s term, which is slated to last through 2038 and is currently in litigation. “We’ll have a majority very shortly. So that’ll be great. Once we have a majority, housing is going to swing, and it’s going to be great.”

For months, Trump has complained that the Fed not lowering interest rates is forcing the federal government to make massive interest payments on its debt and that it is hurting housing affordability for Americans.

If confirmed, Miran would be in a position to be elevated as Fed chair, potentially taking the same route that other former Fed chairs have taken, such as Janet Yellen and Ben Bernanke (both of whom also led the CEA).

According to Fed rules, the chair can be chosen only among current Fed governors; and Fed Chair Jerome Powell, whom Trump has attacked for months, has not revealed whether he plans to stay on the Board after his term as chair ends in May 2026. Powell’s term on the Board runs through 2028, so he could theoretically choose to stay as a Fed governor, though Fed chairs typically step down altogether after their term in that role concludes.

Lisa Cook’s future hangs in the balance

While senators consider the possibility of Miran as a Fed governor, Cook’s own status on the central bank’s governing board is in question.

Last week, Cook filed a lawsuit challenging Trump’s firing of her, claiming the president violated her due process rights under the Constitution and federal law. The federal government said the firing was justified because the president determined there was sufficient cause, citing unproven allegations of mortgage fraud.

According to the Wall Street Journal, the Justice Department has officially opened a criminal investigation into the mortgage fraud claims first lodged by Federal Housing Finance Agency Director Bill Pulte and is “issuing subpoenas as part of an inquiry.”

Cook’s attorney, Abbe Lowell, said in a statement that “the administration is scrambling to invent new justifications for its overreach.”

“The questions over how Governor Cook described her properties from time to time, which we have started to address in the pending case and will continue to do so, are not fraud, but it takes nothing for this DOJ to undertake a new politicized investigation, and they appear to have just done it again,” he said.

Cook requested that the court allow her to remain in her job while the litigation moves forward, but in an emergency hearing on August 29, US District Judge Jia Cobb, a Biden appointee, asked for more written arguments to be submitted to her this week.

The court’s ruling on whether Cook will keep her job while the high-stakes case plays out is crucial, with a Fed policy meeting coming up on September 16-17. The Fed is widely expected to lower rates for the first time since December.

Last week after Cook was fired, the 11 Democrats on the committee that will consider Miran’s nomination called on the chair, Republican Sen. Tim Scott of South Carolina, to postpone Miran’s hearing.

Sen. Warren called on her Republican colleagues to speak out about the president’s actions, and praised Sen. Thom Tillis for saying that he would not support any nominee to replace Cook until after the legal question of her firing is settled.

“I appreciate that, and that is a good first start,” she told CNN.

“We need Republicans. We need all the people in the Senate to stand up and say we’re not going to grease the skids for Donald Trump’s takeover of the Fed,” Warren said in the hearing.

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CNN’s Morgan Rimmer contributed reporting.