Federal Reserve Chair Jerome Powell is under mounting scrutiny after reports revealed that the central bank’s Washington, D.C. headquarters renovation has soared to $2.5 billion and features a host of luxury upgrades. The news comes at a time when many Americans are struggling with high inflation, rising interest rates, and a cost-of-living squeeze, fueling widespread criticism over the project’s timing and scope.

Lavish Renovations Amid Economic Strain

The renovation, initially budgeted at $1.9 billion, has now ballooned by 32%. Lawmakers and the public have expressed outrage, particularly as details have emerged about the nature of the upgrades. Senator Mark Scott, making opening remarks at a recent congressional hearing, highlighted the disconnect between the Fed’s spending and the financial challenges facing everyday Americans. He described how “a college student trying to cover tuition and food with a part-time job is finding that everything costs so much more while credit costs have doubled,” and pointed out that “a senior citizen trying to downsize is watching mortgage rates skyrocket and fixed incomes fall behind.”

Against this backdrop, Scott criticized the Fed for spending on what he called “rooftop terraces, custom elevators that open into VIP dining rooms, white marble finishes, and even a private art collection.” He argued that while updating aging infrastructure is understandable, “when senior citizens can barely afford Formica countertops, it sends the wrong message to spend public money on luxury upgrades that feel more like they belong in the Palace of Versailles than a public institution.”

Powell’s Response and Contradictory Evidence

During his testimony, Powell pushed back on reports of extravagance, stating that “the media reports ... are misleading and inaccurate in many, many respects.” He insisted there were “no VIP dining rooms, no marble, no special elevators, no water features, and no rooftop gardens.” However, planning documents submitted to the National Capital Planning Commission appear to contradict Powell’s denials, listing features such as “vegetated roof terraces,” “private dining rooms,” and “marble finishes.”

Powell did acknowledge the project’s cost overruns, saying, “The cost overruns are what they are,” but maintained that the renovations were necessary for safety and to modernize the nearly 90-year-old building. He explained, “It was not really safe and it was not waterproof,” and added that the upgrades would “provide a modern, efficient workspace for employees to conduct their work on behalf of the American people.”

But multiple critics were quick to point out that this is simply not true, and even accused Powell of lying under oath.  According to planning documents, the upgrades extend far beyond basic repairs or security enhancements, and explicitly include all of the outlined features. The documents explicitly include rooftop terraces designed to attract urban wildlife, custom elevators opening directly into private dining suites, extensive white marble finishes, new water features, and a private art collection. These amenities, described by Senate Banking Committee Chair Mark Scott as “luxury upgrades that feel more like they belong in the Palace of Versailles than a public institution,” highlight the growing disconnect between Fed policy and the American people's struggles. 

Public and Political Backlash

The timing of the spending has only intensified criticism. Scott noted that the Fed “hasn’t turned a profit since 2022,” and questioned the appropriateness of such spending during a period of economic hardship for many. He also raised concerns about the Fed’s political neutrality, referencing its recent policy shifts and international affiliations, and suggesting that “the Fed’s role as an independent, apolitical institution is being questioned.”

The controversy has resonated beyond Congress. On social media, billionaire Elon Musk called for an investigation, remarking that “since at the end of the day, this is all taxpayer money, we should definitely look to see if, indeed, the Federal Reserve is spending two and a half billion dollars on their interior designer. That’s an eyebrow-raiser.”

Broader Implications

As American families continue to feel the pinch of inflation and high interest rates, the optics of luxury spending at the nation’s central bank have become a lightning rod for criticism. The debate over the necessity and extravagance of the renovations is likely to continue, raising broader questions about transparency, accountability, and public trust in the Federal Reserve during a time of economic uncertainty.