Russell Vought, director of the Office of Management and Budget, said an inspector general review of the Federal Reserve’s headquarters renovations wouldn’t be sufficient at finding why the project is over budget.
Fed Chairman Jerome Powell has asked the central bank’s inspector general to review the renovation project, but Mr. Vought took issue with the IG, Michael Horowitz, heading the review since he was appointed by Mr. Powell.
Mr. Horowitz, the Justice Department’s inspector general, was appointed by Mr. Powell in June to take the same position with the Fed. His name is a popular one among President Trump’s supporters for uncovering the FBI’s handling of the Russia hoax.
Mr. Vought said a site visit is in the works.
“This is an institution that has no accountability, and so a little bit of accountability to ask questions, a two-page letter, and allow a site visit so we can get to the bottom of this and have the National Planning Commission ask questions is not too much to ask,” he said.
At a breakfast hosted by the Christian Science Monitor on Thursday, Mr. Vought criticized Mr. Powell for being “constantly late when it comes to his fundamental job” and now not being able to handle renovations.
He compared the price tag on the renovations to France’s Palace of Versailles.
“You do a rack up of all of the biggest buildings in the world, and it’s approaching those levels, and we can’t afford that,” he said. “And it’s just another example of Powell’s mismanagement of the Fed, and the president’s concerned about it.”
The White House is critical of the central bank’s $2.5 billion plan to renovate its headquarters on the National Mall in Washington. The updates were originally priced at $1.8 billion, and the Fed has said the cost rise is due to design changes, increases in the cost of material, equipment and labor, and “unforeseen conditions” such as more asbestos than anticipated and toxic contamination in the soil.
“They either misled Congress or they need to go back to the National Capital Planning Commission and have a reassessment of the project,” Mr. Vought said.
The Fed posted a Frequently Asked Questions page on its website addressing many of the concerns coming from Mr. Vought.
“The Federal Reserve takes seriously the responsibility to be a good steward of public resources. The project will reduce costs over time by allowing the Board to consolidate most of its operations. It involves a complete overhaul and modernization that preserves two historical buildings that have been comprehensively renovated since their construction in the 1930s,” the page said.
Taxpayers aren’t paying the bill for the renovations because the Fed is self-funded through the interest it makes on securities held by the institution and through the fees it charges banks.
Mr. Vought has taken issue with the “level of largesse” he says the Fed has planned for the building.
“I think this is about — the president’s a builder who’s outraged about a cost overrun on the building,” he said. “There’s a lot of policy debates that are going on regarding the Fed. We have policy opinions.”
President Trump has been ripping Mr. Powell, whom he nominated in 2017 and was appointed to another four years by President Joe Biden in 2022.
Mr. Trump has taken to calling the chairman “Too Late” for not lowering the interest rates. The Central Bank says it’s waiting to see the possible inflationary effects from the president’s tariffs.
“Our main concern with the Fed is just that they’re always late,” Mr. Vought said Thursday. “And they were late in the first term. They were late in the Biden administration.”
Mr. Trump has openly talked about replacing Mr. Powell, but then says he won’t. Mr. Powell’s term ends in May.
The Fed is an independent agency and is supposed to be free from political influence and pressure. The president appoints the Fed chairman every four years but doesn’t have the authority to fire him or her.
“No, I’m not talking about that. Fortunately, we get to make a change in the next eight months or so,” Mr. Trump said Wednesday while meeting with Bahrain’s leader.
The president also says nothing is off the table and has claimed there could be “fraud” surrounding the renovations.
Mr. Vought said it’s “energizing” to work with Mr. Trump because “there’s nothing that’s too small that the president won’t care about.”
“The American people elected this president to care about these kinds of things,” he said.
