Kevin Hassett, a top economic adviser to President Donald Trump, on Wednesday assailed a study from the Federal Reserve Bank of New York finding that U.S. companies shoulder most of the costs of tariffs, calling for the central bank to punish the researchers behind the work, which he characterized as an “embarrassment.”
“What they’ve done is they 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,” Hassett, who heads the White House’s National Economic Council, said Wednesday on CNBC.
The comments represent the latest attack on the Federal Reserve from an administration that has repeatedly sought to bully the central bank, with the president himself repeatedly attacking Fed Chair Jerome H. Powell for not slashing interest rates.
The Justice Department is separately examining whether Powell misled the Senate over the summer in testimony that touched on a $2.5 billion renovation of the Fed’s headquarters. Powell has forcefully pushed back against the probe, calling it a pretext to undermine the central bank’s independence on monetary policy.
The White House has also repeatedly attacked economic data and research that reached conclusions it did not like. The president in August called on Goldman Sachs to replace its top economist after the bank concluded U.S. firms and consumers would bear most of the tariffs’ costs — a conclusion that tracks the New York Fed’s. Trump also fired the head of the Bureau of Labor Statistics that month following the release of bleak labor market news.
Hassett had been viewed as the leading contender to succeed Powellwhen the Fed chair’s term expires in mid-May. The disclosure of the criminal probe last month upended what had become a months-long, “Apprentice”-style process, with Trump saying he wanted Hassett to stay at the White House. Trump ultimately settled on Kevin Warsh, a former Federal Reserve governor, as his pick to replace Powell — though it’s unclear whether the nomination will advance as long as the criminal probe remains open.
A New York Fed spokeswoman declined to comment on Hassett’s remarks.
In a study published last week, the New York Fed found that U.S. companies and consumers absorbed nearly 90 percent of the economic burden imposed by tariffs in 2025.
“Our results show that the bulk of the tariff incidence continues to fall on U.S. firms and consumers,” the New York Fed officials wrote. “These findings are consistent with two other studies that report high pass-through of tariffs to U.S. import prices.”
Disputing that conclusion, Hassett argued that U.S. consumers are better off as a result of tariffs, saying the Fed failed to account for changes in import volumes and higher wages of U.S. workers.
“If we bring the stuff home, create the demand at home, then that will hurt China and drive up wages of the U.S., and American consumers will be better off,” Hassett said.
Wednesday’s comments came a day after U.S. Trade Representative Jamieson Greer said that the administration’s tariffs aren’t regressive, reasoning that rich people spend more than poorer consumers.
“It’s not regressive,” he said on CNBC. “Most consumption in America is done by the wealthiest people. So the idea it’s somehow regressive is just wrong.”
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