Powell Defends $2.5B Fed Renovation As Trump's Allies Push For His Exit
The chairman of the Federal Reserve defended himself from a barrage of attacks from Republicans unhappy with a renovation of the central bank headquarters.
Fed Chair Jerome Powell sent a letter to White House budget director Russell Vought Thursday that addressed the wave of criticism he’s faced over the $2.5B project to renovate two buildings in Washington, D.C.
President Donald Trump’s allies have used the costly project to attack Powell, who has resisted pressure from the White House to cut interest rates, and to use the controversy to call for his ouster.
Trump nominated Powell in 2017 for a term that ends in 2026. He cannot be fired without cause, and he said shortly after Trump’s election that he would not leave the post if Trump tried to replace him.
The drama reached a new peak this week when reports circulated that Powell’s firing was imminent. Markets reacted poorly, and Trump squashed the rumors hours later while still noting that the Fed chair was “not doing a good job” and again calling for the central bank to lower interest rates.
Trump’s allies have accused Powell of lying to Congress about the renovation of two federal buildings that sit on the National Mall, which they allege includes opulent amenities like a private elevator, water features and VIP dining rooms.
Powell denied those claims in his letter, taking each in turn.
“We take seriously the responsibility to be good stewards of public resources as we fulfill the duties given to us by Congress on behalf of the American people,” Powell wrote in the letter, which also announced the creation of a public website to outline the renovation plan and its progress.
The buildings were constructed in the 1930s and had not seen a comprehensive renovation since then, and both buildings needed structural repairs to make them safe working environments, including the removal of asbestos and lead fixtures, he wrote.
Powell said reports of a new rooftop garden were actually in reference to the existing ground-level lawn covering the parking structure for its building at 1951 Constitution Ave. He denied that any VIP dining rooms were being built and said any new marble for the project was coming from Georgia and would be used to repair the properties’ damaged facade.
The original, approved plans included a new water feature that has since been eliminated from the final design, while an existing water feature will be restored, he wrote.
The renovation continued without controversy for years before a 2023 Wall Street Journal article highlighted its high price tag. South Carolina Sen. Tim Scott, who had been on Trump’s shortlist as a vice presidential pick, reignited controversy around the project during Powell’s testimony to Congress in June, where he accused Powell of lying and building his own version of the Palace of Versailles.
Bill Pulte, director of the Federal Housing Finance Agency, picked up on the allegations and called for Powell to resign in public comments and social media posts to his 3 million followers. Later, he released a statement on the FHFA website that said he was “encouraged by reports” that Powell was considering leaving his post despite no such reports in the media.
Trump and his allies have been attacking Powell for months, pressuring him to cut the Fed’s benchmark rate, which they argue is holding back economic growth. Powell and other Fed officials have maintained that stubbornly high inflation, which Powell noted is likely to be exacerbated by Trump’s trade policies, have kept them from voting to cut rates.
“Lower the Rate, Too Late!,” Trump said in a post to Truth Social, his social media platform, early Friday morning, using his nickname for the Fed chair.
