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The Department of Justice announced on Friday that it has dropped its investigation into Federal Reserve Chair Jerome Powell, after losing a major ruling in court last month. This is the latest chapter in President Donald Trump’s ongoing attempts to bully the Federal Reserve into manipulating interest rates on the president’s behalf. But the decision to drop these charges won’t just affect Jerome Powell, who likely remains as chair until May and on the board until 2028. The government’s failure also highlights an ongoing challenge to the legality of the Federal Reserve’s independence as a whole, and marks a rare moment in this Supreme Court term where the Trump administration is on the legal back foot.

The Federal Reserve is the government’s independent banking system, with a single chair, plus a board of governors that serve 14-year terms. Board members can only be removed for cause, meaning malfeasance, inefficiency, or neglect in their duties. This “for cause” removal restriction is much to the chagrin of some presidents. In the 1970s, President Richard Nixon also tried to pressure the board into keeping interest rates low so that he could win reelection. The chair at the time refused. Tearing a page from Nixon’s playbook, Trump has, for years, tried to pressure Powell to lower interest rates on terms that would be most convenient for the Republican Party’s political prospects. But like his predecessor in the ’70s, Powell has declined to........

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