The Fed has been a thorn in the side of Americans as well as Trump. But that’s changing now.
Because a top federal official completely vindicated Donald Trump’s Federal Reserve move.
Trump and Powell Clash Over Federal Reserve Renovation Costs
President Donald Trump and Federal Reserve Chair Jerome Powell publicly disagreed during a visit to the Federal Reserve’s headquarters about the cost of its ongoing renovation project.
Trump claimed the project’s total cost had risen to $3.1 billion, stating, “It looks like it’s about 3.1 billion. Went up a little bit — or a lot.”
Powell, visibly disputing the figure, responded, “I haven’t heard that from anybody at the Fed,” suggesting Trump’s numbers referred to a separate building completed five years ago.
However, Mark Paoletta, General Counsel of the Office of Management and Budget, confirmed Trump’s accuracy, citing Federal Reserve documents showing a 2022 budget of $1.8 billion for the headquarters’ three buildings (Eccles, 1951, and Martin) and a 2025 budget reflecting a $2.5 billion cost for the Eccles and 1951 buildings alone, totaling $3.1 billion.
Federal Reserve Budget Overruns Draw Scrutiny
Paoletta’s statement detailed a $1 billion cost overrun for the Eccles and 1951 buildings since the 2022 budget, incurred after Trump’s first term.
The renovation, which includes the Eccles building previously renovated from 1999 to 2003, has raised concerns about fiscal oversight.
On July 10, Office of Management and Budget Director Russell Vought wrote to Powell, criticizing the project’s management and questioning its compliance with the National Capital Planning Act, which mandates approval by the National Capital Planning Commission.
Vought referenced Powell’s June 25, 2025, Senate Banking Committee testimony, where he denied extravagant features like VIP dining rooms or roof gardens, clarifying that some 2021 plan elements were removed.
Vought argued that Powell’s statements suggested significant deviations from the approved plan, prompting calls for greater accountability in the Federal Reserve’s spending on its headquarters.
Broader Trump-Powell Tensions and Policy Implications
The renovation dispute occurs against a backdrop of ongoing friction between Trump and Powell, whose Federal Reserve term ends in May 2026.
Trump has expressed frustration with Powell’s refusal to lower interest rates, a decision made collectively by the Federal Reserve Board, which Powell leads.
In mid-July, Trump indicated he had not ruled out firing Powell, while Powell, in November 2024, stated he would not resign if asked.
During his 2024 campaign, Trump claimed superior economic instincts compared to Federal Reserve officials.
The public disagreement over renovation costs underscores broader policy clashes, with Trump advocating for tighter fiscal discipline and Powell defending the Federal Reserve’s independence.
