White House National Economic Council Director Kevin Hassett called on former Federal Reserve Chair Jerome Powell to resign from the central bank’s board of governors on Sunday. This demand follows the release of an internal inspector general report detailing significant management failures surrounding a costly headquarters renovation project in Washington, D.C.
Appearing on Fox News’ “Sunday Morning Futures,” Hassett argued that Powell’s continued presence on the board after his chairmanship ended in May is unprecedented. He urged Powell to step down to help preserve the long-standing independence of the central bank.
“I think that it’s time for him to move on and to respect the independence of the Fed,” Hassett told host Larry Kudlow. “End this sort of partisan divide that’s very visible at the Fed, and let’s move on to the way the Fed used to be in the past.”
The Fed Renovation Report and Findings
The controversy centers on a September 30 report issued by the Federal Reserve’s internal watchdog. The review investigated the multibillion-dollar renovation project at the central bank’s Washington headquarters, which saw costs climb to $2.4 billion-nearly double the original estimates.
While the inspector general’s report highlighted severe management deficiencies and planning failures that drove up expenses, it explicitly found no evidence of criminal wrongdoing or administrative misconduct connected to the project.
Following the report’s publication, President Donald Trump took to social media to demand that Powell be forced off the board. This renewed criticism adds fuel to a long-running feud between the president and the former Fed chair, which originally ignited over disagreements regarding benchmark interest rate policies.
Justice Department Stance and Independent Audits
Attorney General Todd Blanche addressed the findings, confirming that the Department of Justice would not reopen a criminal investigation into Powell based on the inspector general’s current conclusions.
However, the Federal Reserve has announced plans to engage an independent outside auditor to conduct a further review of the building costs. Blanche noted that the Justice Department could re-evaluate its position if that independent audit uncovers new evidence pointing to criminal misconduct.
Powell has previously defended his choice to remain on the board after stepping down as chair. He stated that ongoing threats of criminal investigations left him with no viable alternative but to retain his board seat and voting power.
Monetary Policy Tensions Continue
The push for Powell’s resignation coincides with broader policy shifts at the central bank. Under current Fed Chair Kevin Warsh, policymakers recently voted unanimously to raise the benchmark interest rate by a quarter percentage point to combat stubborn inflation.
Hassett acknowledged that while he personally disagreed with the decision to hike rates, he respected that Warsh made the call based on his independent economic assessment. The White House continues to monitor central bank leadership as broader economic and regulatory strategies come into sharper focus.
