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There hasn’t been much media to-do about this. So let me try to bring to your attention the Wall Street Journal editorial page calling for Jerome Powell to resign today. Is anybody talking about it? Well one person who talked about it before the editorial was published, was, wait for it…. Hang on… I don’t mean to shock you — President Trump.
Here’s a few snippets from what he said yesterday: “Jay Powell is a disaster. He’s a I call him too late because he was too late with interest rates.” The president added that, of the Fed’s headquarters renovation, “he could have done it for $50 million. I think I could have done it for $25 million. I would have left the walls. I would have left those gorgeous ceilings. We would have spackled them up and fixed them up and painted them up, and they would have been beautiful. It would have been good for another 100 years. He ripped them down and now they’re putting up sheetrock. Just straight sheetrock.
Mr. Trump said “you would have had new electric, new air, new everything, and they wouldn’t have been ripping down gorgeous eagles all over the ceiling.” He concluded that “the reason they have no insulation, he said it wasn’t in the budget, wasn’t it in the budget? You know, insulation is a penny a foot. It’s horrible what they’ve done. He’s incompetent. And a man that’s incompetent should not be sitting on the Federal Reserve Board.” So nobody’s really shocked to hear Mr. Trump.
But the Journal’s editorial board, commenting on the report of the Fed’s inspector general, said: “The salient point is that this project fell victim to as much incompetence as you’d expect, and no criminality.” This according to the publication of Inspector General Michael Horowitz. The Journal goes on to say: “Budgeted for $1.3 billion, the current cost estimate has ballooned to $2.4 billion and it’s on track to be completed three years behind schedule.” Mr. Horowitz describes “a long and expensive comedy of errors.” Macroeconomists at the Fed kept changing building designs, with poorly written contracts for contractors. And the Journal concludes: “Picture the faculty lounge trying to build a new football stadium.”
The new Fed chairman, Kevin Warsh, being a much smarter fellow than his predecessor, has turned the Fed rebuilding project over to the General Services Administration, which has a lot of experience with building projects and presumably will do a better job than the Fed’s faculty lounge.
Now, Mr. Horowitz noted the deficiencies in the Fed’s management of the whole project, but claims that “we did not identify administrative misconduct during our evaluation.” In other words, Mr. Powell is not going to get busted, and he’s not going to jail, even though he was running the place during the vast mismanagement and overruns.
What the Journal said, though, is that now that the former chairman is in the legal clear, “this clears the path for Mr. Powell to resign in line with tradition and do his part to de-escalate the unhelpful political battles that have ensnared the Fed.” Good for the Journal. Now the question is whether Mr. Powell has the common sense to resign.
Many believe he was a highly politicized Fed chairman in the first place, with his Bidenesque overattention to woke DEI, climate change, and easy money during the Biden years.
Democrats today think they’re winning the midterms on affordability. But the last time they had the reins of power, they spent $7 trillion dollars monetized by the Powell Fed, that created a 9 percent inflation peak and over 21 percent cumulative inflation.
They complain about gasoline prices now, but they did everything they could with their radical climate change policies to end fossil fuels altogether, and to tax gasoline to death in the meantime. Just today, Gavin Newsom’s California has $6.50 gasoline, $2 above the national average. Mr. Powell may not have done anything criminal in the Fed building fiasco, but he was certainly complicit in the disaster known as big-government socialism during the Biden years.
