The Trump administration has intensified its attacks on Federal Reserve Chairman Jerome Powell, seizing on a US$2.5 billion headquarters renovation project as potential grounds for dismissal. White House economic adviser Kevin Hassett declared Sunday that President Trump "has the authority" to remove Powell if justified, while Trump himself reiterated his desire for the Fed chair's resignation, claiming Powell has been "very bad for America."
The confrontation centers on alleged cost overruns in the modernization of the Fed's Washington, D.C. headquarters, which Hassett claims have ballooned by US$700 million beyond initial estimates. The remarks follow a May Supreme Court ruling that affirmed presidential authority to dismiss leaders of independent agencies, though legal experts note the decision specifically suggested Fed governors might enjoy special protections to preserve central bank independence.
Observers view the renovation dispute as the administration's latest attempt to undermine Powell before his term expires in May 2020. Hassett, a former Fed economist and current frontrunner to replace Powell, has dramatically shifted his stance on central bank independence - having previously advocated for respecting the Fed's autonomy, he now accuses it of partisan decision-making. The Wall Street Journal reports Hassett met twice with Trump last month, presumably to discuss Fed leadership.
This escalation comes amid persistent tensions between Trump and Powell over interest rate policy, with the president repeatedly blaming the Fed chair for not doing enough to stimulate economic growth. Legal scholars remain divided on whether Trump could legally fire Powell over policy disagreements or management issues like the renovation project, setting up a potential constitutional showdown. The Fed maintains that the renovation costs reflect necessary security upgrades and modernization of the 1970s-era building to meet current operational needs.
Related News:
Trump demands Fed's Chair Powell 'resign immediately'
Trump halts free vocational training program: Impacting skills acquisition for young Americans
Comment