Fed Governor Lael Brainard declared yesterday that the Federal Reserve “is designed to ensure that independence from the executive branch is absolutely the focus of the deliberations of the Federal Open Market Committee.” It is clear that her comments were a response to Donald Trump’s criticisms that the Federal Reserve was keeping interest rates artificially low to help the election of the President’s preferred candidate—Hillary Clinton.

One does not have to endorse Trump’s claims fully to believe that the degree of independence touted by Brainard is a serious overstatement. As Peter Conti-Brown has shown, the practical independence of the Fed falls far short of its design.

The seven members of the Federal Reserve Board of Governors are nominated by the President and confirmed by the U.S. Senate.  It is true that the full term of a governor is fourteen years and appointments are staggered so that one term expires in each even-numbered year The lengthy terms and staggered appointments are indeed intended to contribute to the insulation of the Board—and the Federal Reserve System as a whole—from day to day political pressures.

But governors almost never serve anything close to their fourteen year terms. The outside options are simply so lucrative that almost everyone resigns after terms far short of that. As a result, today every Governor of the Federal Reserve was appointed by President Obama. Brainard herself is Obama’s former Undersecretary of the Treasury, not to mention a candidate for Secretary of that department in the Clinton administration.  Would we think a Supreme Court was independent of the President if all its members were appointed by him?

To be sure, some regional bank presidents also sit on the FOMC. But the design is that they should be less than a majority of the committee. And the Federal Reserve Governors appoint a third of the directors who choose these bank presidents, including the Chairman and Deputy Chairman of each regional bank.

President Obama has generally appointed inflation doves to the Federal Reserve. That is his prerogative and may well be his monetary philosophy. But it almost certainly does goose the economy in the short term, boosting the chances that he will be replaced by a candidate of his party.  Whether that impetus comes at the expense of long-term growth can be debated.  I believe that our loose monetary policy is pushing up asset prices artificially, increasing the long-term risks of bubbles and thus of panics. It also reduces pressure on the United States government to undertake the entitlement and regulatory reforms that are the best way to accelerate growth for a generation.

I am not at all confident that a President Trump would make sound appointments to the Fed once the current governors leave, as most would pretty quickly on his election.  But his criticism of the Fed, including of its actual independence from this President, is fair comment.