Trump Adviser Calls for Discipline of Fed Economists Over Tariff Study Findings

Kevin Hassett, the director of the National Economic Council, publicly criticized research from the New York Federal Reserve on Wednesday, calling for the researchers involved to be “disciplined.” The study in question found that American businesses and consumers are bearing approximately 90% of the cost of tariffs imposed by the Trump administration.

Hassett described the New York Fed paper as “the worst paper I’ve ever seen in the history of the Federal Reserve system,” according to a CNBC interview. He further asserted that the analysis used in the study “wouldn’t be accepted in a first-semester econ class” and that its conclusions, which generated significant media coverage, were “highly partisan.”

The research, published by the New York Fed, determined that nearly 90% of the financial burden from President Trump’s tariffs was being absorbed by U.S. Consumers and businesses. Hassett’s primary objection, as reported by CNN, centers on the study’s focus on price-related effects, arguing it failed to adequately consider changes in import volumes.

However, the study’s authors contend that import volume was taken into account. Their methodology involved calculating average duty rates by dividing total monthly tariff revenue by the total value of imports for that month, effectively incorporating shifts in global supply chains responding to the tariffs.

Both the New York Fed and the Federal Reserve Board of Governors declined to comment on Hassett’s criticisms, according to CNN. Politico reported that Hassett specifically called for the “staffers at the New York Federal Reserve” to be punished for their findings.

The criticism from Hassett comes as the debate over the economic impact of tariffs continues. According to a report from The Hill, Hassett condemned the paper in a Thursday interview, reiterating his disapproval of the New York Fed economists’ conclusions.