‘Worst paper I’ve ever seen’
White House economic adviser Kevin Hassett said Wednesday that the authors of a recent New York Federal Reserve document that found U.S. companies and consumers shoulder much of the tariff burden should be “disciplined.”
In an interview with CNBC, the director of the National Economic Council ripped the report, saying central bank researchers ignored fundamental aspects of how mandates operate and instead focused only on prices. Hassett said the study should also include the upward impact on wages and benefits for U.S. companies by bringing more production onshore.
“I mean, the paper is an embarrassment,” Hassett said during the “Squawk Box” interview. “I think this is the worst article I’ve ever seen in the history of the Federal Reserve system. The people associated with this article probably need to be disciplined, because what they did was come to a conclusion that created a lot of highly partisan news based on analysis that would not be acceptable in a first-semester economics class.”
the paper in question It was published on the New York Fed’s website on February 12.
Researchers essentially examined whether countries exporting products to the United States lowered their prices, actually eating tariffs, or raised their prices and passed them on to consumers and companies. The article noted that approximately 90% of additional costs from tariffs were reflected, but the impact diminished somewhat as the year progressed.
However, Hassett insisted that tariffs had little impact on prices and were responsible for a better standard of living.
“Prices have fallen. Inflation has fallen over time. Import prices fell a lot in the first half of the year, that has leveled off, and real wages increased by an average of $1,400 last year, which means consumers are better off thanks to the tariffs,” he said. “So if this analysis from the New York Fed were correct, consumers would not be made better off by tariffs. It’s a real shame. I can’t imagine who signed off on this.”
The consumer price index rose 2.4% in January from a year ago and was up nearly 2% from April 2025, when President Donald Trump first announced tariffs. CPI, which excludes food and energy, increased by 2.5% in January, its lowest annual increase since March 2021. Import prices Export prices rose 3.1% in December, while export prices remained flat from a year ago, according to the Bureau of Labor Statistics.
A New York Fed official declined to comment.
