Trump Weighs Major Lawsuit Against Fed Chair Powell/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ President Donald Trump is weighing a “major lawsuit” against Federal Reserve Chair Jerome Powell, focusing on the central bank’s multibillion-dollar building renovation. The potential legal move comes amid long-running tensions over interest rate policy and Powell’s handling of the project. White House officials say Trump has not yet made a final decision.
Trump–Powell Lawsuit Quick Looks
- Trump says he may allow lawsuit against Fed Chair Jerome Powell.
- White House press secretary confirms the president is considering the move.
- Dispute centers on cost of the Fed’s headquarters renovation project.
- Trump calls the construction a “grossly incompetent” $50 million fix-up gone wrong.
- Powell accused by some Republicans of giving false testimony to Congress.
- Feud between Trump and Powell includes disagreements over interest rate policy.
- Trump previously threatened to fire Powell but now plans to keep him until May.
- Possible successors include Kevin Warsh, Kevin Hassett, and Christopher Waller.
- Legal firing of Powell would require proving “for cause” under the law.
- Any dismissal could lead to a Supreme Court battle.
Trump Weighs Major Lawsuit Against Fed Chair Powell
Deep Look
President Donald Trump is considering legal action against Federal Reserve Chair Jerome Powell, potentially escalating an already tense relationship between the White House and the central bank. The news was confirmed Tuesday by White House press secretary Karoline Leavitt, following Trump’s own comments on social media earlier in the day.
“Fortunately, the economy is sooo good that we’ve blown through Powell and the complacent Board,” Trump wrote. “I am, though, considering allowing a major lawsuit against Powell to proceed because of the horrible, and grossly incompetent, job he has done in managing the construction of the Fed Buildings.”
Focus on the Fed’s Renovation Project
The dispute centers on the Federal Reserve’s multibillion-dollar renovation of its Washington headquarters — a historic building undergoing extensive updates. Trump has criticized the project’s price tag, claiming it should have been a “$50 Million Dollar fix up. Not good!”
The president’s comments mirror accusations from some Republicans, including Rep. Anna Paulina Luna, who has called for a criminal investigation into whether Powell misled lawmakers during June testimony about the renovation’s scope and cost. The Fed has since published additional materials clarifying Powell’s statements under oath.
When Trump and Powell toured the construction site in July, the president appeared receptive to the project’s scale, saying, “I just would like to see it get finished.” However, his recent tone suggests he now views the renovation as a potential justification for legal or disciplinary action.
Legal Path to Firing Powell
While Trump has repeatedly expressed frustration with Powell — particularly over the Fed’s refusal to lower interest rates — firing him outright is not straightforward. Members of the Federal Reserve Board, confirmed by the Senate, can only be removed “for cause,” a legal standard requiring evidence of misconduct or negligence.
The building project could be framed by the administration as such a cause, though legal experts note that such a case would be unprecedented. If Trump attempted to dismiss Powell, the Fed chair would almost certainly contest it, likely setting up a Supreme Court showdown.
History of Trump–Powell Tensions
Trump’s relationship with Powell has been rocky since early in his presidency. At various points, he has accused the Fed chair of damaging the economy by keeping interest rates too high and has floated firing him. More recently, Trump has said he will let Powell serve out his current term, which ends in May, but intends to announce a successor months in advance.
Despite policy disagreements, Powell has maintained the Fed’s independence, resisting political pressure to alter interest rates for short-term economic or electoral benefit. The building renovation dispute, however, adds a new dimension to their public feud.
Possible Successors and Board Appointments
Trump has already announced plans to nominate Stephen Miran, his Council of Economic Advisers chair, to fill a newly vacant seat on the Fed’s Board of Governors. While Trump said he expects Miran to serve for only a few months and has no plans to nominate him as chair, he has floated several other names for the top job.
Leading contenders reportedly include former Fed Governor Kevin Warsh, National Economic Council Director Kevin Hassett, and current Fed Governor Christopher Waller.
Political and Economic Stakes
The prospect of a lawsuit against Powell adds political uncertainty at a time when the Federal Reserve is balancing inflation concerns with economic growth. Financial markets closely monitor tensions between the White House and the Fed, as policy independence is seen as critical to stable monetary management.
If the administration proceeds with legal action, it could heighten scrutiny over both the renovation project and the broader question of presidential authority over the central bank. For now, the Fed has declined to comment on Trump’s remarks.
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