President Donald Trump has unleashed a fresh barrage of criticism on Federal Reserve Chairman Jerome Powell, questioning his competence and demanding a drastic cut in interest rates. This latest salvo underscores a growing tension between the White House and the independent central bank.
According to Daily Mail, Trump didn’t hold back when asked about Powell’s performance, stating, “I think he's doing a terrible job.” The president went on to insist that interest rates should be slashed by three points, a move he claims would restore America’s economic dominance.
Trump’s frustration isn’t new; just last week, he called for Powell to “resign immediately,” and reiterated that demand when pressed about allegations of misleading testimony before Congress. His argument hinges on the belief that Powell’s policies are costing the nation dearly, a point he hammered home by contrasting the country’s resurgence under his leadership with what he called a “dead country” a year ago.
The federal funds rate currently sits between 4.25 and 4.5 percent, and Trump’s proposed cut would drop it to a mere 1.25 percent. Such a dramatic reduction could ease borrowing costs for homes and spur job growth, though it risks reigniting inflation, a concern Powell has grappled with in recent years.
Historically, the Fed pushed rates near zero during the 2009 financial crisis and again in 2020 during the COVID pandemic’s economic fallout. By 2022, however, rates were climbing to combat soaring prices, a policy Trump clearly views as misguided under Powell’s watch.
While Trump celebrates the nation as “the hottest country anywhere in the world,” he pins the blame squarely on Powell for not capitalizing on this momentum with lower rates. The call for a cut isn’t just economic strategy; it’s a direct challenge to the Fed’s cautious approach, which many see as prioritizing stability over bold growth.
Beyond policy, Trump and his administration have zeroed in on Powell’s management of the Fed’s finances, particularly a staggering $2.5 billion renovation of its Washington, D.C. headquarters. Budget Director Russell Vought accused Powell of “grossly mismanaging” the central bank, pointing to a project cost that ballooned $700 million over initial estimates.
Vought’s letter, shared publicly, criticized lavish details like “VIP dining rooms” and “premium marble,” noting each employee gets an average of 512 square feet of space. This, while the Fed has run a deficit since fiscal year 2023, marks a historic low point in its financial stewardship, according to the administration.
The White House finds this spending particularly galling when contrasted with Trump’s own claims of frugal renovations to the White House cabinet room. The irony of Powell overseeing such an “ostentatious overhaul,” as Vought termed it, while the Fed struggles fiscally, only fuels the narrative of misplaced priorities.
Vought’s critique didn’t stop at costs; he raised concerns about Powell’s testimony before Congress, suggesting discrepancies that warrant further scrutiny from the Office of Management and Budget. This accusation of potential deception adds a layer of personal accountability to the broader policy disagreements.
Trump himself doubled down, stating that if Powell indeed misled Congress about the renovation expenses, he should “resign immediately.” This isn’t just a call for accountability; it’s a signal that the administration views Powell’s leadership as fundamentally flawed on multiple fronts.
With Powell’s term extending until May 2026, and Supreme Court precedent hinting that the president may lack authority to fire the Fed chair, this feud is unlikely to resolve swiftly. Yet, the pressure from Trump and his team suggests they’re intent on reshaping the Fed’s direction, one way or another.
This clash isn’t merely about interest rates or building upgrades; it’s a deeper struggle over who steers America’s economic future. Trump’s vision of aggressive growth through slashed rates collides with Powell’s more measured approach, reflecting a divide between immediate results and long-term caution.
The renovation debacle, meanwhile, serves as a convenient symbol for critics who see the Fed as out of touch, squandering funds while everyday Americans feel the pinch of higher borrowing costs. It’s a potent critique, one that paints Powell as more concerned with marble than Main Street.
As this battle unfolds, the stakes couldn’t be higher, with economic policy and public trust hanging in the balance. Trump’s relentless pushback on Powell signals a refusal to let the Fed operate unchecked, a stance that resonates with those weary of bureaucratic overreach and fiscal irresponsibility.
