- The NEC Director said that the Trump administration’s tariff policies had little impact on prices while improving people's standard of living in the U.S.
- He added that if the NY Fed’s paper was correct, people wouldn’t have been better off now.
- The paper noted that tariff-induced price increases prompted firms to reorganize their supply chains.
White House National Economic Council Director Kevin Hassett on Wednesday reportedly slammed a recent paper from the Federal Reserve Bank of New York, which discussed who is ultimately paying for President Donald Trump’s tariffs.
During an interview with CNBC, Hassett called the paper an embarrassment and the worst one he has read so far in the history of the central banking system.
“The people associated with this paper should presumably be disciplined, because what they’ve done is that they’ve put out a conclusion which has created a lot of news that’s highly partisan, based on analysis that wouldn’t be accepted in a first semester econ class,” the NEC Director said.
Tariffs Had Little Impact On Prices, Says Hassett
The NEC Director said that the Trump administration’s tariff policies had little impact on prices while improving people's standard of living in the U.S.
“Prices have gone down. Inflation is down over time. Import prices dropped a lot in the first half of the year, that leveled off, and real wages were up $1,400 on average last year, which means that consumers were made better off by the tariffs,” Hassett said in the interview.
He added that if the NY Fed’s paper was correct, people wouldn’t have been better off now. “I can’t imagine who signed off on it,” the NEC Director said.
What Did The NY Fed Paper Say?
The NY Fed paper published last week stated that based on data through November 2025, U.S. companies and consumers bore about 94% of the economic burden from tariffs.
Between September and November 2025, exporters absorbed slightly more, with U.S. companies and consumers bearing about 86% of the burden. The paper noted that tariff-induced price increases prompted firms to reorganize their supply chains.
“In sum, U.S. firms and consumers continue to bear the bulk of the economic burden of the high tariffs imposed in 2025,” the paper said.
Meanwhile, U.S. equities gained in Wednesday’s opening trade. At the time of writing, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was up by 0.53%, the Invesco QQQ Trust ETF (QQQ) rose 0.71%, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) gained 0.47%. Retail sentiment around the S&P 500 ETF on Stocktwits was in the ‘bullish’ territory.
The iShares 7-10 Year Treasury Bond ETF (IEF) was down by 0.19% at the time of writing.
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