In spite of Trump heaping pressure on Powell, calling him names, and hinting at firing him before his term expires next year (which is not something he can just do), the Federal Reserve has so far resisted doing the president’s bidding.

First of all, that’s because, in no small part due to Trump’s erratic tariff policies, the US economy remains on uncertain terrain.

In addition, it is important for Powell to show that the Federal Reserve remains independent, which means that the president’s pressure campaign is actually self-defeating.

Now, however, it looks as though the administration is opening up a new front against Powell.

While there is a consensus that a president cannot simply dismiss the chairman of the Fed over policy differences, the White House is currently trying to manufacture a scenario in which Trump could get rid of Powell for cause.

Specifically, the administration is criticizing the Fed over the cost of renovating its headquarters. So far, the project is hundreds of millions of dollars above budget, according to the White House.

“The president is extremely troubled by your management of the Federal Reserve System,” said Office of Management and Budget (OMB) Director Russ Vought in a letter to Powell this week.

Vought, an architect of Project 2025, peppered the chairman of the Fed with a series of questions about the renovation and features he deems to be extravagant. He gave Powell seven business days to respond.

Of course, this isn’t about the Fed’s “largesse,” as Vought put it. It’s about giving Trump a pretense to fire Powell and replace him with a stooge who will then do his bidding and be as independent from the White House as Attorney General Pam Bondi is at the Department of Justice, i.e., not at all.

Kevin Hassett, the chairman of the National Economic Council, gave the game plan away on Sunday, when he said that “it’s being looked into” whether Trump can fire Powell, adding that he “certainly” could “if there is cause.”

According to Hassett, a lot will depend on Powell’s answers to Vought.

If the White House goes down this road, there is a good chance that it will not only cause turmoil in the markets but also that he will get pushback from Republicans in Congress.

On Sunday, Rep. French Hill (R-AR), the chairman of the House financial Services Committee, said he does not believe that Trump has the authority to fire Powell and stressed that the Fed was created as an independent body to be able to set the country’s monetary policy without interference from anybody.

This is especially significant because Powell’s replacement requires Senate confirmation.

Of course, Trump has been operating outside of societal, constitutional, and political norms, so there is no reason to believe that he is not going to try to get rid of the Fed chairman and take total control of the economy in a way no other president in recent memory has.

If we had to predict what is going to happen, we think that he will use the pretense of the headquarter renovation to give it a try, and then back off again when the markets react and Republicans on Capitol Hill cause a rare ruckus, so stay tuned.