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ABC News
4 days ago
- Business
- ABC News
Donald Trump fact-checked by Federal Reserve boss Jerome Powell in exchange over renovations
After months of criticising US Federal Reserve chair Jerome Powell, President Donald Trump took the fight to his front door, publicly scorning the central bank chief over the ballooning costs of a long-planned building project. Mr Powell pushed back, challenging the president's latest price tag as incorrect. Wearing hard hats and grim faces, standing in the middle of the construction project, Mr Trump and Mr Powell addressed the TV cameras. Mr Trump charged that the renovation would cost $US3.1 billion ($4.7 billion), much higher than the Fed's $US2.5 billion figure. Mr Powell, standing next to him, shook his head. The Fed chair, after looking at a paper presented to him by Mr Trump, said the president was including the cost of renovating a separate Fed building, known as the Martin building, that was finished five years ago. The rare presidential visit represented a significant ratcheting up of the president's pressure on Mr Powell to lower borrowing costs, which Mr Trump says would accelerate economic growth and reduce the government's interest payments. "We have to get the interest rates down," Mr Trump told reporters away from Mr Powell. However, Mr Powell and other officials have signalled they will likely keep their key rate unchanged at about 4.3 per cent, but may start cutting rates in September. The Federal Reserve sets a short-term interest rate that influences other borrowing costs, but it does not directly control those other rates. Asked if the rising costs of the Fed's renovation, estimated in 2022 to cost $US1.9 billion ($2.89 billion), were a "fireable offence," Mr Trump said: "I don't want to put this in that category." "To do that is a big move, and I don't think that's necessary," Mr Trump added. "I just want to see one thing happen, very simple: Interest rates come down." On Truth Social, Mr Trump said: "The cost overruns are substantial but, on the positive side, our Country is doing very well and can afford just about anything — Even the cost of this building!" Live updates: Trump clashes with US Fed Chair Mr Trump may be able to remove Mr Powell by accusing him of mismanaging the bank's renovation project. The push comes after a months-long campaign by Mr Trump to try to rid himself of the politically independent central banker, who has resisted the Republican president's calls to slash interest rates out of concerns about the administration's tariffs sparking higher levels of inflation. The Supreme Court recently signalled that Mr Trump could not fire Mr Powell simply because the president disagreed with him on interest rates. But legally, he could do so "for cause", such as misconduct or dereliction of duty. Mr Trump has seized on that provision, indicating that Mr Powell's handling of an extensive renovation project on two buildings in Washington could be grounds to take the unprecedented and possibly legally dubious step of firing him. The project has been underway for years, going back to Mr Trump's first term. But it only recently caught the White House's attention. The Fed chair has been an obstacle in Mr Trump's efforts to gain total control over the executive branch. Mr Powell and his board have the dual mandate of maximising employment and keeping prices stable, a task that can require them to make politically unpopular moves such as raising interest rates to hold inflation in check. The general theory is that keeping the Fed free from the influence of the White House — other than for nominations of Fed officials — allows it to fulfil its mission based on what the economy needs, instead of what a politician wants. An attempt to remove Mr Powell from his job before his term ends would undercut the Fed's longstanding independence from day-to-day politics and could lead to higher inflation, higher interest rates and a weaker economy. The Fed says its main headquarters, known as the Marriner S Eccles Building, was in dire need of an upgrade because its electrical, plumbing and air conditioning systems, among others, are nearly obsolete and some date back to the building's construction in the 1930s. The renovation will also remove asbestos, lead and other hazardous elements and update the building with modern electrical and communications systems. The Fed says there has been periodic maintenance to the structures but adds this is the first "comprehensive renovation". Trump administration officials have criticised the Fed over the project's expense, which has reached $US2.5 billion ($3.8 billion), about $600 million more than was originally budgeted. Russ Vought, the administration's top budget adviser, wrote Mr Powell a letter that said Mr Trump was "extremely troubled" about the Fed's "ostentatious overhaul" of its facilities. The Fed says the renovations will reduce costs "over time" because it will be able to consolidate its roughly 3,000 Washington-based employees into fewer buildings and will no longer need to rent as much extra space as it does now. The Fed's changes to its building plans have opened it up to another line of attack: White House officials have suggested the Fed violated the terms of the approval it received from a local planning commission by changing its plans. In its September 2021 approval of the project, the National Capital Planning Commission said it "Commends" the Fed for "fully engaging partner federal agencies". But because the Fed changed its plans, the administration has indicated it needed to go back to the commission for a separate approval. Essentially, White House officials are saying Mr Powell is being reckless with taxpayer money because of the cost of the renovation, but they are also accusing him of acting unethically by scaling back the project to save money. James Blair, the White House deputy chief of staff whom Mr Trump named to the commission, said in a post on X that Mr Powell's June congressional testimony "leads me to conclude the project is not in alignment with plans submitted to & approved by the National Capital Planning Commission in 2021". Mr Blair said he intended to review materials from the Fed on how the approved 2021 renovation plans had changed and circulate a letter among his colleagues on the commission that would go to Fed officials. AP
Sydney Morning Herald
4 days ago
- Business
- Sydney Morning Herald
Federal Reserve chief schools Trump in excruciating live fact-check
The figures are eye-watering. What started as a $US1.9 billion ($2.9 billion) project in 2023 has blown out to about $US2.5 billion – although, in percentage terms, that's nowhere near as bad as our very own beleaguered North Sydney Olympic Pool. The expensive reno involves two grand Washington buildings, constructed in the 1930s, and is scheduled for completion in 2027. By then, Powell will no longer be the Fed chair – his term finishes in May. Taking their tour, Trump and Powell stood beside each other in matching white hard hats, in what looked like a deleted scene from The Odd Couple. 'It looks like it's about $US3.1 billion. It went up a little bit. Or a lot,' Trump said of the renovation cost. Powell, who had been staring grimly at the floor, turned to the president and began shaking his head. 'I'm not aware of that,' the banker said. 'It just came out,' Trump replied. Powell added: 'I haven't heard that from anybody at the Fed.' Turns out the figure 'just came out' of Trump's jacket pocket, from which the president withdrew a document that Powell then inspected, quizzically, after donning his glasses. It took him just a few seconds to realise the ruse – Trump was trying to conflate two separate projects. Loading 'Oh, you're including the Martin renovation,' Powell said, referring to the refurbishment of another building, which was completed in 2021. 'You just added in a third building, is what that is.' 'It's a building that's being built,' Trump said. 'No, it was built five years ago,' Powell corrected. 'We finished Martin five years ago … it's not new.' Unfazed, Trump turned it over to questions. Asked by a reporter what he, as a real estate developer, would do with a project manager who presided over such budget blowouts, Trump adopted his trademark phrase (and tone) from his days on reality TV show The Apprentice. 'I'd fire 'em,' he said. Asked whether there was anything Powell could say to him that would cause him to back off from his personal attacks, Trump said: 'I'd love him to lower interest rates', and then slapped the bank chairman on the back. And, in an audacious display from someone who has spent weeks calling him every name in the book, Trump batted away suggestions that he might try to fire Powell. 'I don't want to be personal,' he said.
West Australian
4 days ago
- Business
- West Australian
Jerome Powell, Donald Trump argue at Federal Reserve building site over cost blow-outs, feud continues
Donald Trump has confronted Jerome Powell in a tense exchange in front of the media, further fuelling his ongoing dispute with the Federal Reserve chairman. The awkward clash happened as Mr Trump took a tour of the under-construction Federal Reserve building. The two men have been at loggerheads for months, with the US President repeatedly taking issue with Mr Powell for not lowering interest rates for Americans. Mr Powell has resisted intense pressure from Mr Trump and his administration to do so, instead adopting a steady approach, remaining reluctant to slash rates while the President's new tariffs disrupt the US economy. Under the US system, the President has little control over the independent Federal Reserve, including limitations on removing the chair. However, Mr Trump has applied public pressure where he can to force Mr Powell's hand, or push him out. On Thursday, Mr Trump arrived at the new Federal Reserve building site in Washington DC, saying he wanted to come down to check what was going on, taking with him a piece of paper with a new sky-high figure for total costs of the build. 'We're just taking a look at what's happening,' Mr Trump said. 'It's a tough construction job. A lot of expensive work.' Mr Trump was accompanied by Republican Senator Tim Scott, from South Carolina, who is also the chair of the Senate Banking Committee. 'One of the reasons we wanted to see it was the overruns of the expenses,' Senator Scott said. 'We wanted to figure out why.' Mr Trump said he was 'taking a look' because of new figures, which Mr Powell appeared unaware of at first. 'It looks like it's about $US3.1 billion,' Mr Trump said, as Mr Powell began shaking his head. 'It's went up a little bit, or a lot. So the $2.7 is now $3.1,' Mr Trump added. Mr Powell quickly responded, 'I'm not aware of that, Mr President. I haven't heard that from anyone at the Fed.' Mr Trump then handed Mr Powell a folded-up piece of paper, something he claimed was from the Fed. 'This came from us?' Mr Powell asked. 'Yes,' Mr Trump said, adding 'I don't know who does that'. It took Mr Powell around five seconds to quickly scan a document he had not seen before he fact-checked the US President in front of the media, pointing out the error in his calculations. 'You're including the Martin renovation. You just added in a third building,' Mr Powell said. 'I know, it's a building that's being built,' Mr Trump responded. However, Mr Powell refused to accept the President's narrative that costs had blown out by an additional $US400m. 'No, it (the Martin renovation) was built five years ago. We finished Martin five years ago,' Mr Powell said. 'It's part of the overall...' Mr Trump began, dismissing Mr Powell's explanation. 'It's not new,' Mr Powell reasserted. Mr Trump attempted to take a new course with Mr Powell over the costs, cornering him on possible future cost blow-outs. 'We're going to take a look, we're going to see what's happening,' Mr Trump said. 'Do you expect any more additional cost overruns?' he asked the Fed chair. Mr Powell said the Fed didn't 'expect' cost overruns, but was 'ready' if they arose. 'We have a little bit of a reserve that we may use. But, no,' he added. In classic Trump-style, the US President then retook control of the media event, taking off his white hard hat, saying it was nice to take it off when 'we're not under too much danger'. The US President said that as a real estate developer, if he had a project manager who was operating over budget, he would 'fire them'. 'I'd like to see it get finished. In many ways, it's too bad it started, but it did start and it's been under construction for a long time,' Mr Trump said. Asked by a journalist what Mr Powell could say to the US President to get him to 'back off' from criticism, Mr Trump was clear. 'Well, I'd love him to lower interest rates, other than that, what can I tell you?' The Federal Reserve Act of 1913, which created the central bank, says that members of the Board of Governors, including the Fed chief, can be 'removed for cause by the president'. But the law does not define 'cause' or lay out any standard or procedures for removal. No president has ever removed a Fed board member, and the law has never been tested in court. - With Reuters
The Age
4 days ago
- Business
- The Age
Federal Reserve chief schools Trump in excruciating live fact-check
The figures are eye-watering. What started as a $US1.9 billion ($2.9 billion) project in 2023 has blown out to about $US2.5 billion – although, in percentage terms, that's nowhere near as bad as our very own beleaguered North Sydney Olympic Pool. The expensive reno involves two grand Washington buildings, constructed in the 1930s, and is scheduled for completion in 2027. By then, Powell will no longer be the Fed chair – his term finishes in May. Taking their tour, Trump and Powell stood beside each other in matching white hard hats, in what looked like a deleted scene from The Odd Couple. 'It looks like it's about $US3.1 billion. It went up a little bit. Or a lot,' Trump said of the renovation cost. Powell, who had been staring grimly at the floor, turned to the president and began shaking his head. 'I'm not aware of that,' the banker said. 'It just came out,' Trump replied. Powell added: 'I haven't heard that from anybody at the Fed.' Turns out the figure 'just came out' of Trump's jacket pocket, from which the president withdrew a document that Powell then inspected, quizzically, after donning his glasses. It took him just a few seconds to realise the ruse – Trump was trying to conflate two separate projects. Loading 'Oh, you're including the Martin renovation,' Powell said, referring to the refurbishment of another building, which was completed in 2021. 'You just added in a third building, is what that is.' 'It's a building that's being built,' Trump said. 'No, it was built five years ago,' Powell corrected. 'We finished Martin five years ago … it's not new.' Unfazed, Trump turned it over to questions. Asked by a reporter what he, as a real estate developer, would do with a project manager who presided over such budget blowouts, Trump adopted his trademark phrase (and tone) from his days on reality TV show The Apprentice. 'I'd fire 'em,' he said. Asked whether there was anything Powell could say to him that would cause him to back off from his personal attacks, Trump said: 'I'd love him to lower interest rates', and then slapped the bank chairman on the back. And, in an audacious display from someone who has spent weeks calling him every name in the book, Trump batted away suggestions that he might try to fire Powell. 'I don't want to be personal,' he said.
Perth Now
4 days ago
- Business
- Perth Now
‘Fire him': Trump, Powell clash at Fed building site
Donald Trump has confronted Jerome Powell in a tense exchange in front of the media, further fuelling his ongoing dispute with the Federal Reserve chairman. The awkward clash happened as Mr Trump took a tour of the under-construction Federal Reserve building. The two men have been at loggerheads for months, with the US President repeatedly taking issue with Mr Powell for not lowering interest rates for Americans. Mr Powell has resisted intense pressure from Mr Trump and his administration to do so, instead adopting a steady approach, remaining reluctant to slash rates while the President's new tariffs disrupt the US economy. Under the US system, the President has little control over the independent Federal Reserve, including limitations on removing the chair. However, Mr Trump has applied public pressure where he can to force Mr Powell's hand, or push him out. On Thursday, Mr Trump arrived at the new Federal Reserve building site in Washington DC, saying he wanted to come down to check what was going on, taking with him a piece of paper with a new sky-high figure for total costs of the build. 'We're just taking a look at what's happening,' Mr Trump said. 'It's a tough construction job. A lot of expensive work.' Mr Trump was accompanied by Republican Senator Tim Scott, from South Carolina, who is also the chair of the Senate Banking Committee. Sen. Tim Scott, R-S (L), US President Donald Trump (C) and Federal Reserve chair Jerome Powell (R). Credit: Julia Demaree Nikhinson / AP 'One of the reasons we wanted to see it was the overruns of the expenses,' Senator Scott said. 'We wanted to figure out why.' Mr Trump said he was 'taking a look' because of new figures, which Mr Powell appeared unaware of at first. 'It looks like it's about $US3.1 billion,' Mr Trump said, as Mr Powell began shaking his head. 'It's went up a little bit, or a lot. So the $2.7 is now $3.1,' Mr Trump added. Mr Powell quickly responded, 'I'm not aware of that, Mr President. I haven't heard that from anyone at the Fed.' Mr Trump then handed Mr Powell a folded-up piece of paper, something he claimed was from the Fed. 'This came from us?' Mr Powell asked. 'Yes,' Mr Trump said, adding 'I don't know who does that'. It took Mr Powell around five seconds to quickly scan a document he had not seen before he fact-checked the US President in front of the media, pointing out the error in his calculations. 'You're including the Martin renovation. You just added in a third building,' Mr Powell said. 'I know, it's a building that's being built,' Mr Trump responded. However, Mr Powell refused to accept the President's narrative that costs had blown out by an additional $US400m. 'No, it (the Martin renovation) was built five years ago. We finished Martin five years ago,' Mr Powell said. 'It's part of the overall...' Mr Trump began, dismissing Mr Powell's explanation. 'It's not new,' Mr Powell reasserted. Mr Trump attempted to take a new course with Mr Powell over the costs, cornering him on possible future cost blow-outs. 'We're going to take a look, we're going to see what's happening,' Mr Trump said. 'Do you expect any more additional cost overruns?' he asked the Fed chair. Mr Powell said the Fed didn't 'expect' cost overruns, but was 'ready' if they arose. 'We have a little bit of a reserve that we may use. But, no,' he added. In classic Trump-style, the US President then retook control of the media event, taking off his white hard hat, saying it was nice to take it off when 'we're not under too much danger'. President Donald Trump's visit aimed to pile pressure on Federal Reserve chair Jerome Powell. (AP PHOTO) Credit: AAP The US President said that as a real estate developer, if he had a project manager who was operating over budget, he would 'fire them'. 'I'd like to see it get finished. In many ways, it's too bad it started, but it did start and it's been under construction for a long time,' Mr Trump said. Asked by a journalist what Mr Powell could say to the US President to get him to 'back off' from criticism, Mr Trump was clear. 'Well, I'd love him to lower interest rates, other than that, what can I tell you?' The Federal Reserve Act of 1913, which created the central bank, says that members of the Board of Governors, including the Fed chief, can be 'removed for cause by the president'. But the law does not define 'cause' or lay out any standard or procedures for removal. No president has ever removed a Fed board member, and the law has never been tested in court. - With Reuters
