Pardon as Contract

Ian Ayres

A week ago Sunday, Jeanine Pirro, the U.S. attorney in Washington, told CNN’s State of the Union that she would appeal the order voiding grand jury subpoenas against Federal Reserve Chair Jerome Powell and further indicated a willingness to pursue the case against Powell anew.  But less than two weeks earlier, on April 24, the Department of Justice had announced it was dropping that same criminal investigation.  It appears that any commitment the President makes today can be rescinded tomorrow.

That credibility problem is now blocking the normal transition of leadership at the Fed.  The President wants Jerome Powell out as a Fed Governor, because Powell’s seat, which runs through early 2028, gives Powell a vote against the interest-rate cuts that the President desperately wants.

But resignation strips Powell of the institutional protection that has, so far, kept the Justice Department at bay.  Federal district judge James Boasberg quashed the original grand jury subpoenas — for alleged misstatements to Congress about the Fed's headquarters renovation — because their “dominant (if not sole) purpose is to harass and pressure Powell either to yield to the president or to resign and make way for a Fed chair who will.”  That improper-motive finding evaporates the moment Powell is no longer at the Fed.  The DOJ has pursued former FBI director James Comey twice since he left government service; nothing in the law would stop the DOJ from coming after Powell after he resigns. 

Powell can be forgiven for wanting assurance, before resigning, that the criminal investigation is “well and truly over with finality and transparency.” 

A conditional pardon might give both sides what they want.  Such a pardon, conditioned on Powell’s prompt governorship resignation, would credibly discharge Powell’s exposure to prosecution, while simultaneously giving conceding to the President an additional appointment to the Board of Governors.

Presidential pardons are not self-executing.  Like contractual offers, they can be rejected by the potential pardonee.  Moreover, a President is free to attach conditions to acceptance.  As my colleague Stephen Carter has summarized, “One who accepts the pardon agrees to the conditions; and those conditions, unless they demand an illegal act or are impossible to perform, become legally binding.”

Conditional pardons of this sort are hardly a modern invention.  Presidents have used them since the early Republic to attach strings to clemency.  In 1829, Andrew Jackson pardoned one recipient on the condition that he learn “some beneficial trade” — essentially, that he get work and become self-supporting.  Other presidential pardons have required recipients to serve in the military, leave the country, or otherwise accept limits on their freedom as the price of forgiveness.

Presidents would do well to continue this tradition more deliberately.  For example, President Biden did his son and the public no favors when he granted Hunter a “full and unconditional” pardon.  Hunter Biden has publicly acknowledged a history of addiction, and federal law bars gun possession by users of controlled substances.  The President’s pardon could have made Hunter’s agreement not to purchase or possess firearms a condition of clemency.

A meaningful concern is whether offering Powell a conditional pardon would look like asking an innocent man to confess.  The Supreme Court observed in Burdick v. United States that a pardon "carries an imputation of guilt; acceptance a confession of it." Moreover, accepting this pardon might set a harmful precedent of normalizing a kind of presidential extortion.

To be clear, in putting forth the possibility of a conditional pardon, I am not suggesting that Powell broke the law.  Indeed, to my mind, the public record supports Judge Boasberg’s conclusion that “the government has offered no evidence whatsoever that Powell committed any crime other than displeasing the president.” 

But the possibility of vindictive prosecution is unfortunately no longer a hypothetical possibility.  The realistic question is not whether to engage with the President's leverage, but whether to convert it into something binding.

We tend to think of pardons as presidential largess, which, like mercy, “droppeth as the gentle rain from heaven.”  But in this case, a pardon would be a commitment device that would tie the president’s own hands.  Once accepted, the president could not rescind it, the Justice Department cannot revisit it, and Powell would exit with the protection that resignation alone would otherwise strip away. 

Powell might choose to reject an offered conditional pardon.  He has indicated that he might stay on even if the criminal investigation were dropped once and for all, saying that his decision would be guided by what he believes would be in “the best interest of the institution and the people we serve.” 

Recent Fed chairs have honored the tradition of stepping down from their governorships when their terms as Chair end.  A conditional pardon would grant Powell the opportunity to continue that tradition gracefully — and would turn the abused executive power that created this credibility problem into an instrument that resolves it.