OPINION: Powell affair shows the US is devolving into a Greater Turkiye

By Damla Dogan Tuncel, KORKUSUZ Gazette

Summary:

The investigation into U.S. Federal Reserve Chair Jerome Powell is not just an American political drama. For Turkish readers, it is a familiar warning. The clash between President Donald Trump and the Fed echoes Türkiye’s own experience with political interference in monetary policy — a path that led to institutional erosion, policy volatility, and lasting economic damage. As the U.S. now tests the limits of central bank independence, Türkiye stands as a cautionary tale of what happens when those limits collapse.

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A Powell Investigation — And a Familiar Pattern

An investigation has been opened into Jerome Powell, the head of the U.S. Federal Reserve. The formal allegation is that Powell misled Congress over the renovation of the Fed’s headquarters.

In Washington, however, few believe this is the real issue.

Even Powell himself appears to regard the probe as a pretext.

The underlying conflict has been visible for months.

Trump’s Pressure on the Fed

Donald Trump has repeatedly and openly attacked Powell for refusing to cut interest rates. His language has been unusually harsh, even by modern political standards. Powell has been described as “the wrong man,” “incompetent,” “a major loser,” “a fool,” and at times, “stupid.”

Until recently, Powell responded with restraint.

He avoided personal confrontation.
He spoke in carefully calibrated language.
He emphasized, again and again, the independence of the Federal Reserve.

At one point, he even relied on symbolism. Referencing Republicans as red and Democrats as blue, Powell appeared wearing a purple tie — signaling that the central bank stands above partisan politics. He also stated clearly that the president does not have the authority to dismiss a Fed chair over policy disagreements.

That restraint ended with the investigation.

A Line Powell Wouldn’t Cross — Until Now

Known for weighing every word, Powell spoke with rare bluntness.

“This threat of criminal prosecution is a consequence of the Federal Reserve setting interest rates based on what it judges best serves the public, rather than following the President’s preferences.”

He added:

“No one, including the Chair of the Federal Reserve, is above the law. However, this unprecedented action must be evaluated in a broader context — alongside the administration’s threats and sustained pressure.”

With that statement, Powell ceased to be just a central banker. He became a symbol — standing alone against political pressure on an institution designed to be independent.

The debate intensified quickly:
Can a president, even an elected one, interfere with institutions meant to operate outside political control?

For the United States, this is an unusual debate.

For Türkiye, it is not.

A Movie Türkiye Has Already Seen

Because this story has already played out — in Ankara.

In July 2019, Recep Tayyip Erdoğan dismissed then–Central Bank Governor Murat Çetinkaya by presidential decree.

It happened in the middle of the night.
Without explanation.
Without public debate.

Later, Erdoğan defended the decision bluntly.

“The drum and the drumstick cannot be in different hands,” he said — meaning interest rates and political authority should be controlled by the same power.

On another day, he added:
“He didn’t listen.”

What followed is well known.

Governors changed.
Interest rate policy lurched from one extreme to another.
The cost was borne by society.

Murat Uysal, Naci Ağbal, Şahap Kavcıoğlu — each resisted for a time, then either adapted or was removed.

The Meaning of a Missing Letter

There is a symbolic but powerful detail in the name of Türkiye’s central bank:

Türkiye Cumhuriyet Merkez Bankası.

Not Türkiye Cumhuriyeti Merkez Bankası.

That missing “i” was meant to signal that the bank answers not to the government of the day, but to rules.

At least, once upon a time.

That is why a remark made years later still resonates. When Russia invaded Ukraine in February 2022, the Russian central bank raised interest rates sharply. Asked for his view, Vladimir Putin replied:

“I cannot interfere. The central bank is independent. Otherwise, we would end up like Türkiye.”

It was meant as a warning.

The Irony Today

That warning is now gaining relevance elsewhere.

For years, Türkiye aspired to be “like America.”
Today, the United States is confronting a test Türkiye has already failed.

There is still a crucial difference.

In the U.S., the system is resisting.
Powell remains in office.
The purple tie is still around his neck.

In Türkiye, those ties were removed long ago.
Governors were lined up.
The economy paid the price.

Not About Rates — About Rules

Trump’s confrontation with Powell is not merely a personal feud.
It is not even primarily about interest rates.

It is a deeper conflict: rules versus instructions.

As Türkiye continues to live with the consequences of weakened institutional independence, the United States is now facing the same test.

Some countries already know how this story ends.

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