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2d ago

White House Intensifies Fed Renovation Probe to Build Case for Firing Powell

Facing an OMB deadline to explain $2.5 billion in overruns, Fed Chair Jerome Powell has posted a public defense to shore up the central bank’s autonomy.

Construction on the Marriner S. Eccles Federal Reserve building in Washington, DC, on June 25.
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U.S. Federal Reserve Chair Jerome Powell testifies before a House Financial Services Committee hearing on "The Semiannual Monetary Policy Report to the Congress," on Capitol Hill in Washington, D.C., U.S., June 24, 2025. REUTERS/Kevin Lamarque/File Photo

Overview

  • OMB Director Russell Vought has given Powell until the end of this week to respond to questions about alleged mismanagement and unauthorized changes in the Fed’s $2.5 billion headquarters overhaul.
  • The Federal Reserve updated its website with a detailed FAQ rebutting claims of ostentatious features and explaining cost overruns as necessary for asbestos removal, infrastructure upgrades and compliance with review agencies.
  • National Economic Council Director Kevin Hassett and other senior officials have publicly suggested that, if Powell’s answers fail to satisfy the probe, President Trump could remove him for cause.
  • Legal experts and Supreme Court precedents emphasize that Fed chairs can only be dismissed for proven misconduct, setting up a potential legal showdown over central bank independence.
  • Speculation is rising about potential successors—Treasury Secretary Scott Bessent, Fed Governor Christopher Waller and Kevin Hassett—while markets and lawmakers monitor threats to monetary policy autonomy.