A growing number of Republicans on Capitol Hill are expressing unease with the Justice Department’s move to investigate Federal Reserve Chair Jerome Powell, a sign that the probe could become a major inflection point over GOP lawmakers’ concerns about central bank independence.
Powell announced Sunday that the DOJ is investigating him over statements to Congress about renovations of the Fed’s headquarters in Washington. He said the issue was a pretext to target him in response to President Donald Trump’s frustration over the Fed’s hesitance to aggressively lower interest rates.
Sen. Kevin Cramer (R-N.D.), a Powell critic who sits on the Senate Banking Committee, said in a statement Monday that “Jerome Powell is a bad Fed Chair who has been elusive with Congress, especially regarding the overruns of the elaborate renovations of the building.”
“I do not believe however, he is a criminal,” he said. “I hope this criminal investigation can be put to rest quickly along with the remainder of Jerome Powell’s term. We need to restore confidence in the Fed.”
Separately, Sen. Lisa Murkowski (R-Alaska) on Monday offered among the harshest GOP rebukes yet on X, writing that “the administration’s investigation is nothing more than an attempt at coercion.”
“If the Department of Justice believes an investigation into Chair Powell is warranted based on project cost overruns—which are not unusual—then Congress needs to investigate the Department of Justice,” she said. “The stakes are too high to look the other way: if the Federal Reserve loses its independence, the stability of our markets and the broader economy will suffer.”
Senate Banking Republicans are expected to meet Monday night to discuss major cryptocurrency legislation the panel is aiming to hold a vote on this week — and some members are expecting to discuss the Powell probe as well, according to two Republicans with knowledge of the plan who were granted anonymity to discuss closed-door matters.
“There will be a lot of chatter,” said one of the Republicans.
The investigation is also a concern for some House Republicans. Rep. Mike Lawler (R-N.Y.), who sits on the House Financial Services Committee, told POLITICO: “While I fundamentally believe Chairman Powell was late in addressing inflation under Joe Biden and has been woefully slow in lowering interest rates over the past year, the independence of the Federal Reserve is paramount and I oppose any effort to pressure them into action.”
Other Republicans are signaling less concern about the probe. Sen. Cynthia Lummis (R-Wyo.) said in a statement that “whether Chairman Powell was unprepared for his testimony or intentionally misled Congress about the Fed’s extravagant spending, the American people deserve answers.”
“I will wait for the DOJ to release its findings before commenting further,” she said.
Asked about the Powell investigation on Fox Business on Monday, Sen. Roger Marshall (R-Kan.) bashed the central bank chief and said the “president is sending a message to everybody that we’re going to be looking out for fraud, waste and abuse.” But, pressed by host Maria Bartiromo about whether Powell lied to Congress, Marshall said he would “let the system play through here,” and added: “I think there’s other issues that we should be focused on.”
The controversy over the renovations to the Fed’s Washington headquarters has been amplified by Senate Banking Republicans, including Chair Tim Scott (R-S.C.), who pressed Powell about the issue during a hearing last June following a New York Post article about cost overruns on the project.
Now, the DOJ probe is threatening to derail the Senate’s consideration of future Fed nominees. Sen. Thom Tillis, a retiring North Carolina Republican who sits on the Banking panel, said Sunday he will “oppose the confirmation of any nominee for the Fed—including the upcoming Fed Chair vacancy—until this legal matter is fully resolved.” Murkowski, who does not sit on Banking but is a key swing vote on the Senate floor, said on X that Tillis “is right in blocking any Federal Reserve nominees until this is resolved.”
“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 said in his statement. “It is now the independence and credibility of the Department of Justice that are in question.”