A second Donald Trump presidency poses grave dangers for the U.S. Weighed against the chances of exploding public debt, the collapse of global trade and the erosion of democratic norms, the risk that he’d attack the Federal Reserve’s independence might seem trifling. It isn’t.

An effective central bank is indispensable for economic stability — and a politically subordinate central bank cannot be effective.

Recently, in an interview with Bloomberg, Trump was asked to clarify his position on interfering with Fed policy. He began as you’d expect by mocking the institution and its chairman. Running the central bank is the greatest job in government, he said: Show up once a month, flip a coin to set interest rates and be treated like a god. He said he understands monetary policy better than Fed Chair Jerome Powell (his own appointee, by the way) and expects to have a say on interest rates even if, as president, he couldn’t just tell the central bank what to do.

Granted, by Trump’s standards, this was fairly restrained. (In 2019, he asked in a tweet, “Who is our bigger enemy, Jay Powell or Chairman Xi?”) Given another term in the White House, he might be more ambitious. Firing or demoting the Fed chairman would be legally challenging, which doesn’t mean Trump wouldn’t try, but short of that he could nominate a more compliant successor when Powell’s term ends in 2026.

Meanwhile, a sustained and derisive running commentary on Fed policy might unsettle financial markets even if the Fed’s policy makers refuse to submit.

Doubtless, impairing the Fed’s credibility wouldn’t trouble Trump in the least. But voters should indeed be troubled. Confidence that the Fed, free of political interference, is able to discharge its dual mandate to control inflation and support maximum employment is vital. By anchoring expectations, it makes the central bank’s goals less costly to achieve.

When inflation rises due to an unforeseen shock — as during the pandemic — the Fed’s credibility means that prices can be brought back under control with relatively small increases in interest rates and hence only temporary and relatively modest increases in unemployment. Without such confidence, monetary policy has to respond more forcefully, destroying output and jobs on a far larger scale. The alternative would be to let inflation stay high, which harms workers and consumers in its own right while merely postponing the eventual reckoning.

Governments of every advanced economy have come around to this view. Legislatures typically oversee the goals of monetary policy, but central banks are granted operational independence in pursuit of their mandates. Once governments converged on this approach, low inflation became the norm, and the benefits of central-bank independence were rarely questioned. The Fed and its peers were left to do their job, free not merely from outright political control but also from overt attempts to influence their operations.

Trump, blissfully unaware of the risk his posturing poses for the economy, thinks he knows better. Voters, hardened to his excesses, need to wise up. They dismiss this prospect at their peril.

— The Bloomberg Opinion Editorial Board