Washington (AP) -President Donald Trump may have found a way to achieve his goal of eliminating the chairman of the Federal Reserve, Jerome Powell: by accusing him of having abused the 2.5 billion dollar renovation project of the US Central Bank.
The advance takes place after a month -long campaign of Trump to free himself from the politically independent central banker who has opposed the call from the Republican President, to reduce interest rates out of concerns about the government’s tariffs that have a higher level of inflation.
The Supreme Court recently signaled that Trump cannot simply fire Powell just because the president does not agree to interest rates. But legally he could do this “from the matter” such as misconduct or breach of duty.
Trump confiscated this provision, which points out that Powell’s handling of an extensive renovation project on two FED buildings in Washington could be a reason to take the unprecedented and possibly legally dubious step.
The project has been underway for years and goes back to Trump’s first term. But the white house’s attention was recently attracted.
Last week when he was asked whether he thought the renovation of the building was a “fir criminal offense”, Trump said: “I think that’s it.” However, he later added that it was “extremely unlikely” that he would ultimately remove Powell before his term in office in May 2026.
The risk of losing its political independence could undermine the financial markets of America, which may lead to a breakdown of stocks and investors who calculate a premium for the economy of the US economy.
Here is what to know:
Verlire Powell risks that run market panic
The Fed chairman was an obstacle to Trump’s efforts to achieve complete control over the executive.
Powell and his board have twice the mandate of maximizing employment and keeping prices stable, a task in which they have to make politically unpopular movements such as increasing interest rates for inflation. The general theory is that the liberation of the Fed from the influence of the White House – except for the nominations of Fed officials – enables their mission based on what the economy needs, instead of a politician.
An attempt to remove Powell from his job before his term ends would undermine the Fed’s many years of independence from daily politics and could lead to higher inflation, higher interest rates and a weaker economy.
The Fed’s headquarters is over 90 years ancient
The FED says that its headquarters, which is known as the Marrin S. Eccles building, urgently needed an upgrade, since among other things its electrical, sanitary and HLK systems are almost out of date and some return to the construction of the building in the 1930s.
The renovation will also remove asbestos, lead and other risky elements and update the building with up-to-date electrical and communication systems. The H-shaped building, named after a former Fed chair in the 1930s and 40s, is located near some of the highest monuments in Washington in the highest profiles and refers to classic architecture and marble in the facades and masonry. The central bank also renovates a building next door that it acquired in 2018.
The FED says that the structures have been regularly maintained, but adds that this is the first “comprehensive renovation”.
The renovation costs have fallen over the years
Trump administration officers criticized the Fed about the effort of the project, which has reached 2.5 billion US dollars, more than originally budgeted about $ 600 million than originally.
Like a oppressed homeowner who is exposed to a redesign project with the spiral costs, the Fed quotes many reasons for the larger costs. The construction costs, including materials and workers, rose strongly during the inflation tip in 2021 and 2022. More asbestos had to be removed than expected. Washington local restrictions for the heights are forced to build underground, which is more steep.
In 2024, the Fed’s board terminated its planned renovations of a third building due to rising costs.
The FED says that the renovation work will reduce the costs “over time” because it will be able to consolidate its around 3,000 employees in Washington in fewer buildings and not to rent as much more space as now.
Budget director of the White House calls renovation work as “prahm” to “
Russian, the government’s highest budget consultant, wrote Powell a letter in which Trump was “extremely worrying” about the “magnificent revision” of the Fed about his facilities.
The FED’s renovation plans require “roof terrace gardens on the roof, VIP -private dining rooms and elevators, water features, premium marble and much more,” said Vookt in the letter of the past week.
Powell denied the claims that were widespread in Mercatus Center, a thinking factory at George Mason University, in March 2025. The paper was written by Andrew Levin, an economist at Dartmouth College and former Fed employee.
“There is no VIP dining room,” said Powell last month during a hearing from the Senate Banking Committee. “There is no new marble. … There are no special elevators. There are no new water features. … and there are no roof terrace gardens.”
Some of these elements were removed from the first building plans submitted in 2021, says the Fed.
The White House also has problems with the FED that lowers the renovation costs
The changes to the FED on the construction plans have opened it for another line of attack: Officials of the White House suggest that the Fed violates the conditions of approval they received from a local planning commission by changing their plans.
In its approval of the project in September 2021, the National Capital Planning Commission announced that it “calculates” the FED for “full partner federal authorities”. However, since the FED has changed its plans, the administration states that it would have to return to the Commission for a separate approval.
Essentially, officials from the White House say that Powell is ruthless because of the cost of renovating tax money, but they also accuse him of acting unethically by schooling back the project to save money.
James Blair, the deputy chief of staff of the White House, which Trump named in the Commission, said in a post that Powell’s congress statement in June means that the project is not with the plans that were presented and approved by the National Capital Planning Commission in 2021. “
Blair said that he intended to check materials from feeding how the approved renovation plans of 2021 have changed and a letter among his colleagues would be transferred to the Fed civil servants.
The Fed asked for an independent review of the project
The Central Bank says that in a row it is not subject to the direction of the Commission on its website “and only voluntarily adhered to its guidelines.
Instead, the Fed said that it was responsible to the Senate and the House of Representatives and is monitored by an independent general inspector, not the White House. Powell has asked the General Inspector to check the costs of the renovation project.
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