Democrats in both chambers of Congress—and a small number of Republicans—are condemning President Donald Trump’s administration after Federal Reserve Chair Jerome Powell said the central bank received grand jury subpoenas from the Department of Justice (DOJ). Several lawmakers say they may refuse to support any Trump nominee to lead the Fed until the matter is resolved.
On Sunday, Powell confirmed the subpoenas arrived Friday and said they include the threat of an indictment tied to his summer testimony about ongoing renovations to the Federal Reserve’s historic office buildings in Washington, D.C.
“He is abusing the law like a wannabe dictator so the Fed serves him and his billionaire friends,” Massachusetts Senator Elizabeth Warren wrote Sunday. “The Senate must not move ANY Trump Fed nominee.”
Newsweek said it contacted the White House and the DOJ for comment. The Federal Reserve told Newsweek it had nothing to add beyond Powell’s statement and referred questions to the DOJ.
Why the backlash is intensifying
Trump has repeatedly criticized Powell—whom he nominated in 2017—over the Fed’s pace on interest-rate cuts. Over the past year, Trump regularly attacked the chair personally and publicly suggested he could remove him before his term ends, while also floating legal pressure connected to the cost of the renovation project.
Critics argue the latest development goes beyond rhetoric, raising alarms that the administration is trying to weaken the Fed’s independence and influence monetary policy directly.
What Powell said the subpoenas are about
In a video released Sunday, Powell said the DOJ’s threat is linked to his testimony before the Senate Banking Committee last June, where lawmakers questioned the multi-year renovation project.
Estimated costs have risen from $1.9 billion in 2019 to $2.5 billion in the Fed Board’s 2025 budget. During his testimony, Powell disputed claims from Republican lawmakers that the project amounted to “lavish renovations.”
In a July statement, the Federal Reserve said it “takes seriously the responsibility to be a good steward of public resources” and argued the project would lower costs over time by consolidating operations.
Powell, however, suggested the investigation is being used as retaliation—saying the real issue is the Fed setting rates “based on our best assessment of what will serve the public, rather than following the preferences of the president.”
Republicans and Democrats cite threats to independence
North Carolina Republican Senator Thom Tillis said the subpoenas raise concerns about political interference.
“If there were any remaining doubt whether advisers within the Trump administration are actively pushing to end the independence of the Federal Reserve, there should now be none,” Tillis posted to X. He added that the DOJ’s “independence and credibility” are now in question.
Democratic Senator Mark Warner of Virginia called the episode another example of what he described as a “chaos-driven approach to the economy,” warning that “working Americans” would bear the costs.
Warren also accused Trump of seeking a “corrupt takeover” of the central bank, arguing he wants to replace Powell and push him off the Fed’s board entirely.
Powell’s term as chair ends in May, and Trump is expected to name a successor. Both Tillis and Warren said they would oppose any nominee while the legal matter remains unresolved. Tillis said Sunday: “I will oppose the confirmation of any nominee for the Fed—including the upcoming Fed chair vacancy—until this legal matter is fully resolved.”
What people are saying
Powell said in his Sunday statement that the threat is “not about” his testimony or the renovation project, calling those “pretexts.” He argued the pressure stems from the Fed’s refusal to set rates to match the president’s preferences and said the Fed had worked to keep Congress informed through testimony and public disclosures.
Todd Belt, director of the Political Management Program at George Washington University, told Newsweek the situation appears to be “political retribution” for Powell’s reluctance to cut rates as Trump wanted.
Political commentator and former White House communications director Anthony Scaramucci wrote on X that the message to future Fed chairs is clear: defy Trump and risk prosecution.
Former Republican Representative Adam Kinzinger said in a video posted to X that the move is meant to intimidate Powell into lowering rates, arguing monetary policy decisions should be insulated from political pressure.
Democratic Representative Melanie Stansbury of New Mexico wrote on X that threats against an independent Fed can shake markets and affect inflation, retirement savings, and employment.
What happens next
In an interview with NBC News, Trump said he had no knowledge of the DOJ probe, but criticized Powell’s performance, saying he is “not very good at the Fed” and “not very good at building buildings.” Trump added that rates are “far too high.”
The Fed cut rates three times during its final meetings of 2025, but is expected to keep rates steady at its next meeting in late January.
Powell is scheduled to step down as chair in May. Even after that, he could remain at the Fed as a governor, since his separate 14-year term on the Board of Governors would allow him to continue serving.
