Trump Targets Fed Renovation To Pressure Powell Resignation/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ President Trump escalates efforts to pressure Fed Chair Jerome Powell by scrutinizing the central bank’s costly headquarters renovation. Trump’s allies allege deceptive spending while urging lower interest rates. The campaign risks undermining the Federal Reserve’s traditional independence.
Trump Versus Fed Renovation Quick Looks
- Trump seeks lower rates or Powell’s resignation.
- White House focuses on Fed headquarters renovation expenses.
- Budget adviser labels renovation plans “ostentatious overhaul.”
- Trump’s aides join commission overseeing federal building plans.
- Powell resists rate cuts amid inflation concerns.
- Allegations claim Powell misled Congress on renovation scope.
- Fed’s independence threatened by growing political attacks.
- Potential legal battle looms over Fed’s renovation authority.
Trump Targets Fed Renovation To Pressure Powell Resignation
Deep Look
President Donald Trump is dramatically escalating his fight with Federal Reserve Chairman Jerome Powell, deploying a new tactic aimed not at interest rates directly, but at the marble-clad corridors of the Fed’s iconic headquarters in Washington, D.C.
In the latest move, Russ Vought, Trump’s top budget chief, dispatched a sharply worded letter to Powell on Thursday, declaring the president is “extremely troubled” by what he called an “ostentatious overhaul” of the Marriner S. Eccles Federal Reserve Building. Vought alleged that the proposed renovation, featuring rooftop terraces, VIP dining spaces, and high-end materials, might violate federal building standards.
At stake is not merely architectural aesthetics but the integrity of one of America’s most fiercely independent institutions. Trump’s strategy appears designed to squeeze Powell into either lowering interest rates to stimulate the economy—or stepping down from his post altogether. Either outcome would mark a dramatic expansion of presidential influence over an institution historically shielded from the swings of political power.
“This is another test of the limits of presidential influence over the Federal Reserve,” said Sung Won Sohn, a finance and economics professor at Loyola-Marymount University. “If the Fed’s independence is compromised, it’s bad for the economy, bad for inflation expectations, and bad for long-term inflation.”
Powell, who has largely refrained from engaging in political spats, declined to comment on Vought’s letter. However, during Senate testimony last month, he acknowledged that earlier renovation plans had changed, confirming that more extravagant elements, like rooftop terraces and elaborate dining rooms, were scrapped from the updated plans.
Nevertheless, the White House has seized on the renovation controversy as a potent political cudgel. In a move loaded with implications, Trump has appointed two loyal aides—James Blair, deputy chief of staff, and Will Scharf, the staff secretary responsible for drafting presidential executive orders—to the National Capital Planning Commission. The commission oversees federal development projects in Washington, giving these aides potential leverage to scrutinize and possibly stall the Fed’s building plans.
Blair announced via social media that he would “request a review of all previous and current building plans” and raised the possibility that Powell was not fully truthful during his testimony to Congress. “If he’s not truthful about this,” Blair asked online, “how else is the American Public to maintain confidence that its monetary policy manager is acting in their interests?”
Trump’s public criticisms of Powell have grown increasingly heated, with the president labeling Powell “a very stupid person” and demanding his immediate resignation. Trump insists that inflation is under control and argues that cutting rates now would lower borrowing costs for mortgages, car loans, and consumer debt while helping the government finance a rising federal deficit fueled by new tax cuts.
“LOWER THE RATE!!!” Trump posted on social media Thursday, amplifying his call for looser monetary policy.
However, financial experts warn that the path Trump demands carries significant risks. Lowering rates too aggressively could reignite inflationary pressures, while the bond market might refuse to cooperate by raising yields on government debt despite the Fed’s moves, ultimately worsening borrowing costs for consumers.
Powell, originally nominated to the Fed’s Board of Governors by President Barack Obama and elevated to chairman by Trump during his first term, has become one of Trump’s most frequent targets during his second term. Despite the president’s fury, Trump has repeatedly said he will not directly fire Powell, acknowledging that the Supreme Court ruled in May that it could block any presidential attempt to oust the Fed chair without cause.
Nonetheless, Trump’s political allies have found indirect ways to ramp up the pressure. Bill Pulte, director of the Federal Housing Finance Agency and a Trump appointee, recently accused Powell of misleading Congress about the Fed’s renovation plans and called for an investigation into potential political bias and false testimony.
“I am asking Congress to investigate Chairman Jerome Powell, his political bias, and his deceptive Senate testimony, which is enough to be removed ‘for cause,’” Pulte declared last week, adding that the situation “stinks to high heaven.”
At the heart of the dispute is whether the Fed’s renovation qualifies as an extravagant misuse of public funds or merely necessary updates to a 90-year-old building housing the nation’s top economic policymakers. Vought argues that even past upgrades completed in 2003 should be considered comprehensive, contradicting Powell’s testimony that the Eccles Building has never undergone a serious renovation.
Under U.S. law, the Fed has broad authority to maintain its own “suitable” and “adequate” facilities, potentially setting up a legal clash between the White House and the central bank. If Trump’s campaign against the renovation is successful, it could embolden future administrations to use budgetary and regulatory tools to challenge the Fed’s operations—a precedent that many economists view as deeply troubling.
In the meantime, the standoff threatens to become yet another political flashpoint in Washington, placing the central bank’s hallowed independence under unprecedented strain.
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