President Donald Trump's chief economic advisor, Kevin Hassett, has sharply criticized a report from the Federal Reserve Bank of New York. The document indicates that the costs of U.S. tariffs overwhelmingly burden domestic companies and consumers, not foreign producers. Hassett called the publication "embarrassing" and called for disciplinary consequences against its authors, sparking a debate about the independence of research institutions.

Attack on Fed Independence

Advisor Kevin Hassett publicly demands punishment for economists for publishing data contrary to the White House's political line.

Tariff Burden on Americans

A report by the New York Fed proves that 94% of the costs of tariff duties are covered by domestic importers and consumers in the USA.

Strategic Resources Under Protection

President Donald Trump activated the Defense Production Act to protect national resources of elemental phosphorus and agricultural production.

A conflict is escalating between the White House and the Federal Reserve System following the publication of a report on the real effects of Donald Trump's tariff policy. According to the analysis by the New York Fed, American importers bear as much as 94% of the costs of the imposed tariffs, which contradicts the administration's official narrative. The Fed argues that 10% tariffs caused only minimal price reductions by foreign suppliers, meaning the financial burden rests on the shoulders of Americans. Economic advisor Kevin Hassett, in an interview with CNBC, did not mince words, describing the document as "the worst piece of research in Fed history." The suggestion that scientists should be "disciplined" or punished for their findings raises concerns about political pressure on independent expert bodies. Meanwhile, the president signed an order utilizing the Defense Production Act to secure supply chains for phosphorus and glyphosate-based herbicides, which is crucial for the Pentagon and the agricultural sector. Relations between the Trump administration and the Federal Reserve have been tense for years, reminiscent of historical disputes from the 1970s when President Richard Nixon exerted strong pressure on then-Fed Chairman Arthur Burns to stimulate the economy ahead of elections.„This article is a disgrace. I think it's the worst piece of work I've ever seen in the entire history of the Fed. The authors should be disciplined.” — Kevin Hassett The economic situation is also becoming more complex on a global scale – Japan announced $36 billion in investments in American gas and mineral projects as part of a broader trade agreement. Concurrently, outside U.S. borders, a fuel crisis in Cuba has led to the suspension of nickel mining by Sherritt International and a paralysis of waste exports in Havana.Distribution of Financial Burdens from Tariffs: American importers: 94, Foreign producers: 6Tariff Narrative vs. Fed Findings: Who pays for tariffs?: Foreign producers (according to the White House) → American consumers (according to the Fed); Impact on goods prices: No significant increase → Significant burden on importers

Mentioned People

  • Donald Trump — President of the USA, who signed the decree on resource protection and pushes the policy of tariff duties.
  • Kevin Hassett — Director of the National Economic Council, who attacked scientists from the New York Fed.