Federal Reserve renovation costs have drawn sharp political scrutiny as White House Deputy Chief of Staff James Blair prepares to inspect the central bank’s $2.5 billion project. His visit reflects growing tensions between President Donald Trump and Fed Chairman Jerome Powell over spending and monetary policy.
The Fed’s two Washington, D.C., office buildings in Foggy Bottom are undergoing extensive upgrades. Although the Federal Reserve is funding the renovations without taxpayer money, Trump has criticized Powell for the rising costs. Unexpected construction issues and national inflation have contributed to the overruns, according to Powell.
“There’s no new marble, no special elevators, and no extravagant features,” Powell told lawmakers recently. He highlighted essential updates such as asbestos and lead removal and replacement of outdated systems like electrical, plumbing, and fire suppression.
Earlier, Office of Management and Budget Director Russell Vought sent a letter labeling the project an “ostentatious overhaul.” Powell defended the renovations in a written response, arguing that structural repairs were critical to ensure safety and efficiency.
Federal Reserve renovation costs have added fuel to Trump’s frustrations with Powell’s cautious approach to interest rates. Trump has pushed for aggressive rate cuts, claiming they could save the country hundreds of billions of dollars. However, Powell has maintained the central bank’s borrowing rate within a 4.25% to 4.5% range, citing uncertainty tied to tariff impacts.
Tensions have escalated as Trump publicly accused Powell of doing a “lousy job.” He also suggested that many candidates are eager to replace the Fed chief, though he stated he likely would not dismiss Powell before his term ends next May. Yet, Trump added he would not “rule out anything.”
Federal Reserve renovation costs now serve as a flashpoint in the broader dispute over monetary policy and fiscal priorities. Blair’s upcoming visit could signal further White House intervention as debates intensify over the Fed’s role and spending decisions.
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