Sycophancy is a common trait across the Trump administration, but it particularly stands out when coming from people who should know better. As director of the National Economic Council, Kevin Hassett is one of the foremost economists in the White House, let alone the country. And yet, in the interest of keeping his boss happy, he’ll ignore all evidence that President Donald Trump’s tariffs are hurting American consumers and call for the researchers who drafted it to be punished.
It’s concerning that Hassett would call for the authors to be “disciplined” for writing a piece of analysis.
Last week, the New York Federal Reserve Bank’s Liberty Street Economics blog published a post titled “Who Is Paying for the 2025 U.S. Tariffs?” In it, four members of the bank’s research group looked at the “tariff incidence” — as they explained it, “the technical term for how the costs of a tariff are split between foreign exporters and domestic importers” — for goods imported through last November. Exporters can lower their goods’ price, shifting the tariff incidence towards them by eating some of the tariff cost, or keep them the same rate, passing on the cost to the importer.
While Trump may claim that foreign companies are paying the bulk of the tariff costs, the Fed researchers instead asserted that “nearly 90% of the tariffs’ economic burden fell on U.S. firms and consumers.” In other words, foreign exporters kept their prices mostly unchanged and instead let American companies feel the full burden. Those costs then, in turn, have been passed on to American consumers, helping keep prices high even as other inflationary pressures have waned.
(It is worth noting that the blog also includes this disclaimer alongside its posts: “The views expressed are those of the authors, and do not necessarily reflect the position of the New York Fed or the Federal Reserve System.”)
When asked about the paper during a CNBC interview Wednesday, Hassett took the opportunity to fully disparage it and its authors:
“I mean, the paper is an embarrassment,” Hassett said during the “Squawk Box” interview. “It’s, I think, the worst paper I’ve ever seen in the history of the Federal Reserve system. The people associated with this paper should presumably be disciplined, because what they’ve done is 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.”
It’s concerning that Hassett would call for the authors to be “disciplined” for writing a piece of analysis. Moreover, the post’s methodology followed an approach that three of the authors used in a 2019 paper on the impact of tariffs in Trump’s first term. It’s hard to see how that one got published in the Journal of Economic Perspectives if the newer analysis wouldn’t pass muster in an undergrad course.
It’s Hassett who seems afraid that his math won’t check out.
And given the lack of rigor that’s gone into preparing Trump’s tariff regime, it’s particularly galling that Hassett would try to dunk so hard on this research. Let’s not forget that the supposedly “reciprocal tariffs” rolled out on Trump’s “Day of Liberation” last April were based on the most bafflingly basic formula possible, hidden behind a slew of Greek letters to make it look respectable. It was so hastily considered that nobody stepped forward to claim credit for it, even after the initial set of tariffs were put on pause.
Since then, Trump has only grown more enamored with tariffs, even as the Supreme Court debates whether they represent an overreach of political power. He’s not a man of many policy preferences, but it can be impossible to detach him from those he does hold dear. For example, last August, when Goldman Sachs’ top economist came to the same conclusion about the tariffs’ burden falling on Americans, Trump called for the bank to fire him.
And so, even in the face of hard data that shows foreign companies are not, as Trump has often claimed, paying for the tariffs, his administration must continue to pretend otherwise. If Hassett really wanted to disprove the work that he’s critiquing, he has a team of economists of his own that could publish a rebuttal. But that would invite more scrutiny and chances of being proven wrong than simply dismissing their research during a TV interview.
The New York Fed researchers were more than happy to show their work in their post. It’s Hassett who seems afraid that his math won’t check out.
Hayes Brown is a writer and editor for MS NOW. He focuses on politics and policymaking at the federal level, including Congress and the White House.