Clash Over Federal Reserve Renovation Costs

President Donald Trump and Federal Reserve Chair Jerome Powell had a public disagreement regarding the escalating costs of renovations at the Fed’s headquarters.

On July 24, Trump claimed the renovation expenses had risen to $3.1 billion, which exceeded the Fed’s earlier estimate of $2.5 billion. Powell appeared skeptical and shook his head at Trump’s assertion.

“It looks like it’s about $3.1 billion. Went up a little bit, or a lot,” Trump stated, arguing that the costs had increased significantly from previous figures.

“I’m not aware of that, Mr. President,” Powell replied, indicating he had no prior knowledge of this estimate.

The president then retrieved a document from his pocket to support his claim, prompting Powell to don his reading glasses for a closer inspection.

After reviewing the document, Powell informed Trump that the figure included costs from a separate building finished five years ago.

“It’s part of the overall work,” Trump defended.

“It’s not new,” Powell countered.

Trump’s points drew attention not just from Powell but also from other officials in his administration, including Senators Tim Scott and Thom Tillis, who were part of a tour of the Federal Reserve amidst scrutiny over the headquarters’ renovations.

Prominent White House officials have rallied around the $2.5 billion figure, raising concerns about potential cost overruns and possible regulatory violations by Powell.

White House deputy chief of staff James Blair and budget chief Russell Vought have taken the lead on scrutinizing the renovations. Earlier in the month, Trump suggested that these overruns “could be” a reason to dismiss Powell. Yet, he later clarified that he did not intend to remove him before his term finishes in May.

In response, Powell has requested an investigation into the renovation costs by the central bank’s inspector general. Additionally, the Fed has published an explanation on its website detailing reasons for the increased project costs.