Fed Chair’s Authority Faces Challenge as Unclear Rules Risk Internal Power Struggle

The Federal Reserve Board has seven governors. The chair serves a four-year term, while governors may serve for up to 14 years. However, the chair’s authority to set the agenda and coordinate votes rests largely on precedent and persuasion rather than explicit rules. As a result, control over payments policy and banking supervision could shift as governors form alliances.

After Kevin Warsh became Fed chair in 2026, former chair Jerome Powell remained eligible to serve as a governor until January 31, 2028, creating the rare situation of a current and former chair serving together on the board. The recent dispute centers on who controls the agenda and policy implementation. No transaction amount is involved; the key issue is voting among the seven governors and the internal distribution of power.