Former President Donald Trump has reportedly contemplated dismissing Jerome Powell, the current chair of the Federal Reserve, as scrutiny intensifies over a costly renovation project at the Fed’s headquarters. Names now being floated to replace Powell publicly by Trump himself. This rumored action would take place just months prior to Powell’s term expiring next spring.
The recently completed renovation project came under harsh scrutiny as costs skyrocketed. It has now ballooned to an astounding $2.5 billion, or roughly $700 million above its original budget. That puts the renovation cost at a whopping $1,923 per square foot. That’s twice the typical cost to renovate a typical historic federal building.
Russell Vought, another influential official close to Trump, resurfaced in the news recently. He followed up with a letter to Powell, insisting that he receive answers to 11 specific questions regarding the costly renovation within seven business days. Vought referenced Powell’s testimony before the Senate Banking Committee on June 25, where he stated, “There’s no VIP dining room. There’s no new marble. There are no special elevators. There are no new water features. There’s no beehives and there’s no roof terrace gardens.”
Vought’s letter raises some urgent questions about what Trump actually plans to do. Will he fight to get Powell removed for cause, particularly given the millions in financial shortfall on the renovation? In his communications, but especially in his last piece of testimony too, Williamson warned that Powell’s testimony would indicate non-compliance with the National Capital Planning Act. This act requires that the National Capital Planning Commission approve such projects.
“Your testimony raises serious questions about the project’s compliance with the National Capital Planning Act, which requires that projects like the Fed headquarters renovation be approved by the National Capital Planning Commission.” – Russell Vought
In his letter, Vought pointed out that while “minor deviations from approved plans may be inevitable,” Powell’s testimony suggests that the renovation project is significantly out of alignment with the approved design elements. He emphasized the project’s budgetary issues by stating, “While continuing to run a deficit since FY23 (the first time in the Fed’s history), the Fed is way over budget on the renovation of its headquarters.”
Further highlighting the project’s extravagant costs, Vought remarked, “The Palace of Versailles would have cost $3 billion in today’s dollars!” His criticism has been bolstered by a tweet linking to his letter sent to Powell on the social media platform X.
The growing discontent surrounding Powell’s management of the Federal Reserve and the renovation project raises important questions about fiscal responsibility and governance at one of the nation’s most critical financial institutions. Tempers are flaring, and we don’t think anyone knows exactly what’s going to happen next. We still don’t know what this will mean for Powell—or for Trump’s administration.