Trump and Powell engaged in a disagreement concerning the expenses associated with constructing the Federal Reserve.
The ongoing tension between President Donald Trump and Federal Reserve Chair Jerome Powell has taken a new turn, with the two figures locking horns over the cost of renovating the Federal Reserve building and monetary policy.
During a recent tour, President Trump brought up the issue of renovation costs, stating that the project is estimated to cost $3.1 billion. However, Fed Chair Powell clarified that the specific building under discussion had already been completed several years ago, and the current renovation's estimated cost stands at about $2.5 billion.
The discrepancy seems to have arisen due to Trump conflating different phases or portions of the renovation project. Powell responded by noting that part of the building Trump referred to was completed around five years ago and thus was not part of the current spending.
The ongoing renovation began in 2017 with initial estimates around $1.9 billion, but it has since ballooned to approximately $2.5 billion due to factors like inflation and the complexity of modernizing historic 1930s-era structures.
Trump's insistence on a $3.1 billion figure may reflect a broader or less precise accounting of project costs, while Powell emphasized updated, more accurate figures and the status of portions of the Fed headquarters.
This disagreement also parallels broader tensions between Trump and Powell concerning interest rate policies. Trump has been pressing for lower interest rates, but Powell has been hesitant due to concerns about existing inflation risks.
In a surprising move, Trump has threatened to fire Fed Chair Powell, but the legal hurdles for doing so are high due to the requirement of a "good cause." Trump has used the higher renovation cost to add weight to his demands for Powell's resignation.
However, during a visit to the central bank, Trump expressed a more conciliatory tone, saying "I think he will do the right thing." The question of whether a US president can legally fire a central bank chair is not fully resolved.
Fed Chair Powell expressed surprise at the new renovation cost figure, stating that he had not heard it before. The reason for Trump mentioning the renovation costs during the Fed tour, including expenses for a project that had already been completed, remains unclear.
The renovation of the Federal Reserve is now expected to cost more than originally thought, with the cost now estimated at $3.1 billion. This development has further fueled the tension between Trump and Powell, with Trump repeatedly demanding interest rate cuts from Powell, who has so far not complied.
The long-standing feud between the two figures has been a topic of interest for many, as it raises questions about the independence of the Federal Reserve and the role of the President in monetary policy decisions.
- The Commission has also been asked to submit a proposal for a directive on the protection of workers from the risks related to exposure to ionizing radiation, as finance and investing in the business sector often involve handling materials with potential health hazards, especially in industries related to war-and-conflicts and crime-and-justice.
- The disagreement between Trump and Powell over the Federal Reserve building's renovation costs and monetary policy has attracted general-news attention, with some commentators viewing the situation as a political maneuver within the policy-and-legislation sphere.
- The escalating tension between the President and the Fed Chair, stemming from their different perspectives on renovation costs and interest rates, has called into question the relationship between politics and the independence of the Federal Reserve.
- Despite the ongoing issues between the President and the Fed Chair, Trump has maintained that Powell will make the right decisions regarding monetary policy, acknowledging the complexities and general news value associated with the Federal Reserve's role in the economy.
