What's Happening?
Kevin Hassett, the White House National Economic Council Director, has publicly criticized a report by the New York Federal Reserve that claims American households and businesses are bearing over 90% of the economic burden from tariffs imposed in 2025. The report, authored by Fed researchers, indicates that the average tariff rate increased from 2.6% to 13% in 2025, significantly impacting import prices. Hassett dismissed the report as biased and inaccurate, suggesting that the authors should face disciplinary actions. This criticism is part of a broader pattern of the Trump administration's pushback against research indicating that tariffs are adversely affecting American consumers and businesses.
Why It's Important?
The controversy surrounding the New York Fed's
report highlights the ongoing debate over the economic impact of tariffs under President Trump's administration. The findings challenge the administration's narrative that foreign entities bear the cost of tariffs, suggesting instead that American consumers and businesses are disproportionately affected. This has significant implications for U.S. economic policy and public perception, as it questions the effectiveness of tariffs as a tool for economic leverage. The administration's response to such reports could influence future trade policies and economic strategies, potentially affecting various sectors reliant on imports.
What's Next?
The White House's strong reaction to the New York Fed's report may lead to further scrutiny of the Fed's research methodologies and findings. It could also prompt additional studies or reports from other economic institutions to either support or refute the Fed's conclusions. The administration's stance may influence upcoming policy decisions regarding tariffs and trade agreements. Additionally, the ongoing debate may impact public opinion and political discourse, especially as the economic effects of tariffs continue to unfold.
