Full Breakdown
Trump Calls for Jerome Powell’s Resignation After Fed Inspector-General Report
By Drooid · · How we work
Core Event: President Trump Demands Powell Step Down
Trump said he had directed Attorney General Todd Blanche to study the Inspector-General (IG) report on the Fed’s headquarters renovation and determine appropriate action.
Background & Context
The Federal Reserve’s Washington headquarters—comprising the Marriner S. Eccles and 1951 Constitution Avenue buildings—has been undergoing a renovation that began in 2020. The project’s budget has risen repeatedly, with estimates reported at roughly $1 billion, $1.9 billion, $2.381 billion, and nearly $2.5 billion. The cost growth has become a focal point for criticism of Powell, who led the Fed during most of the construction, and for broader debates over the central bank’s independence.
Data & Statistics
- Original budget (Feb 2020): $1.317 billion.
- Revised budget (Dec 2024): $2.381 billion.
- Current estimate: approaching $2.5 billion.
- Specific overruns: plumbing and air-conditioning costs reached $346 million, three times the initial estimate.
- Project timeline: construction expected to finish by December 2027.
Official Statements & Responses
- Jerome Powell: In a video statement, Powell said the Department of Justice’s criminal probe and grand-jury subpoenas were “politically motivated,” intended to pressure the Fed to lower interest rates. He also requested a fresh IG review of the project’s costs.
- Kevin Warsh (Fed Chair): Warsh pledged to follow the IG’s recommendations, hire an independent auditor to verify costs, and oversee the General Services Administration’s takeover of project management.
- U.S. Attorney Jeanine Pirro: Issued subpoenas to the Fed Board in January 2026 seeking information on Powell’s testimony; a federal judge later quashed the subpoenas, finding them a pretext to influence monetary policy. Pirro closed the investigation in April 2026.
- Attorney General Todd Blanche: Tasked by Trump to review the IG report; no public determination has been released.
Criticism & Opposition
- Sen. Tim Scott (R-SC), Senate Banking Committee chair: Called the cost overruns “egregious” and urged “rigorous oversight” of the Fed, emphasizing that inflation does not excuse imprudent spending.
- Russell Vought, OMB director: Objected to “ostentatious” design elements such as marble and a garden terrace, though the IG found these features did not materially drive cost increases.
Conflicting Reports & Gaps
- Cost figures: Sources differ on the total projected cost—France 24 cites a “roughly $1 billion” overrun, Forbes mentions $2 billion awarded for construction, Fox Business reports a $2.381 billion revised budget, and RawStory notes the estimate has grown to “nearly $2.5 billion.”
- Causes of overruns: All sources agree inflation contributed, but some emphasize mismanagement (absence of a guaranteed-maximum-price contract, limited subcontractor bidding) while others point to unforeseen site conditions such as asbestos and a high water table.
- Legal outcome: The DOJ’s criminal investigation was opened, then blocked by a federal judge, and ultimately dropped; the IG report’s lack of criminal findings leaves open questions about potential administrative reforms.
What’s Next
- The Fed’s IG will monitor implementation of its seven recommendations, and the General Services Administration will assume project oversight.
- Congressional committees are expected to hold hearings on the renovation’s management and the broader issue of political pressure on the Federal Reserve.
- Attorney General Todd Blanche’s review of the IG report may lead to further executive action, though no deadline has been announced.