Washington– President Donald Trump’s chief economist on Wednesday urged that Federal Reserve economists be punished for their research Last week It showed that US businesses and consumers are paying almost all of the new tariffs imposed by the White House last year.
“This paper is embarrassing,” Kevin Hassett, director of the White House National Economic Council, said in an interview on CNBC. “It is the worst paper I have ever seen in the history of the Federal Reserve System. The people associated with this paper should be disciplined.”
Hassett’s comments represent The latest attack from the Trump administration On the Fed, which has traditionally been independent Of everyday politics. As the White House suggests remains sensitive to concerns about rising costs of groceries, housing and big-ticket items like furniture and cars, as surveys show Americans remain disaffected with the economy.
Several other studies have reached conclusions similar to those reached by the Federal Reserve Bank of New York, including one conducted by the Federal Reserve Bank of New York economists at Harvard University and the University of Chicago; Separate report By Kiel Institutea German research center; And a a report last week by the nonpartisan Congressional Budget Office.
A study published by the Federal Reserve Bank of New York Last weekIt found that American businesses and consumers pay nearly 90% of Trump’s tariffs. Economists found that average tariffs on imports rose from 2.6% at the beginning of last year to 13% at the end of the year.
Since American importers pay tariffs directly to the Treasury Department, the main way foreign companies will bear the burden of costs – the Trump administration has said – is by lowering their prices to offset the costs of the tariffs. Research by the Federal Reserve Bank of New York found that foreign exporters reduced their prices only slightly, much less than the tariff increase.
This is not the first time the White House has attacked economists for concluding that Americans are paying the tariffs or will soon do so. Last August, Goldman Sachs’ chief economist predicted that Americans would pay an increasing share of tariffs over time. Trump responded by calling on David Solomon, CEO of Goldman Sachs, to fire the economist.