In a striking move, President Donald Trump has publicly called for the resignation of Federal Reserve Chair Jerome Powell, igniting a firestorm of controversy over the central bank’s leadership.
According to The Hill, the dispute centers on allegations of misleading testimony by Powell regarding a massive $2.5 billion renovation project for the Fed’s headquarters in Washington, D.C., compounded by Trump’s ongoing criticism of Powell’s policies.
The latest chapter in this saga began last week when Powell testified before the Senate Banking Committee. During the session, senators pressed Powell on the details of a $2.5 billion renovation plan for the Federal Reserve’s headquarters building. Powell defended the project, explaining that certain extravagant elements included in earlier proposals had been removed from the current plans.
He further clarified that other expenses, such as fixing elevators to board members’ offices and maintaining marble fixtures, were necessary for basic upkeep of the existing structure. However, not everyone accepted Powell’s explanations as truthful or satisfactory. FHFA Director Bill Pulte, a vocal critic of Powell, accused the Fed chair of providing deceptive information to lawmakers during his testimony.
Pulte went as far as to argue that Powell’s statements were grounds for dismissal from his position. This criticism caught the attention of President Trump, who has been openly critical of Powell for months. Trump, who appointed Powell to the role in 2017, has repeatedly expressed frustration over the Federal Reserve’s decision to maintain steady interest rates.
Adding to the tension, Trump has even considered the possibility of firing Powell, though such an action would be unprecedented. On Wednesday, Trump escalated his criticism by posting on Truth Social, using his nickname for Powell, “Too Late.” In his post, Trump demanded that Powell step down, stating, “‘Too Late’ should resign immediately!!!”
Trump also linked to a Bloomberg News article that highlighted Pulte’s accusations against Powell. This public demand for resignation marks a significant escalation in the ongoing feud between Trump and the Federal Reserve chair. The controversy has drawn attention from other political figures as well, amplifying the debate over Powell’s leadership.
Rep. Jim Jordan (R-Ohio), chair of the House Judiciary Committee, weighed in on the matter in a statement to Bloomberg. Jordan indicated that “lawmakers will look at calls to investigate Powell,” signaling potential further scrutiny. This statement suggests that the allegations against Powell could lead to formal inquiries by Congress.
The renovation project at the heart of this controversy is a significant undertaking, with a price tag of $2.5 billion. Critics like Pulte argue that such a costly project demands transparency and accountability from Fed leadership. Powell’s explanations during the Senate testimony aimed to address these concerns, but they have instead fueled further debate.
For many observers, the dispute raises broader questions about the Federal Reserve’s priorities during a time of economic uncertainty. Trump’s repeated criticism of Powell, including the nickname “Too Late,” reflects a deeper dissatisfaction with the Fed’s handling of monetary policy. This ongoing tension between the president and the central bank chair adds another layer of complexity to the situation.
The Federal Reserve operates independently of direct political control, a principle designed to insulate monetary policy from partisan influence. However, Trump’s public demands and consideration of firing Powell challenge this independence, raising concerns among some policymakers and economists. The outcome of this conflict could set a precedent for future interactions between the White House and the Fed.
As the controversy unfolds, lawmakers like Rep. Jordan are signaling their intent to delve deeper into Powell’s conduct. The allegations of misleading testimony, if substantiated, could have serious implications for Powell’s tenure as chair. Meanwhile, public opinion remains divided on whether Powell should remain in his role or step down as Trump demands.
For now, the Federal Reserve has not issued an official response to Trump’s call for resignation or Pulte’s accusations. The silence from the Fed contrasts with the vocal criticism from Trump and others, leaving room for speculation about Powell’s next steps.
As this story develops, all eyes will be on Congress and the Federal Reserve for any signs of resolution or further escalation.