White House National Economic Council director Kevin Hassett said Sunday on ABC’s “This Week” that President Donald Trump’s tariffs would not be a “heavy burden on the U.S. consumer.”
Partial transcript as follows:
STEPHANOPOULOS: You know, the president promised all through the campaign that prices would come down right away. Said they’d come down right away. Now he’s saying, hang tough. It won’t be easy. How high are prices going to go? How long will they stay there?
HASSETT: I actually saw in this story that you just gave, George, there’s kind of like a logical disconnect between the stories – the competing stories that your team is using to attack President Trump.
On the one hand, you’re saying that the countries are really angry, they’re going to have to retaliate. On the other hand, you’re saying that consumers are going to bear the costs and it’s going to drive inflation up. But if U.S. consumers are bearing the cost, there’s no reason for the countries to be angry. So, the fact is, the countries are angry and retaliating and, by the way, coming to the table.
I got a report from the USDR last night that more than 50 countries have reached out to the president to begin a negotiation. But they’re doing that because they understand that they bear a lot of the tariff. And so, I don’t think that you’re going to see a big effect on the consumer in the U.S. because I do think that the reason why we have a persistent, long-run trade deficit these people have very inelastic supply. They’ve been dumping goods into the country in order to create jobs, say, in China.
And, George, also, I promise you, I’ll answer your question directly and not filibuster. So, I’ll stop with that.
STEPHANOPOULOS: Well, what do you base your – where do you base your conclusion that you’re not going to see an increase in prices? Just about every economist who’s looked at this said you are going to see an increase in prices, including Goldman Sachs, including JP Morgan, including the chairman of the Federal Reserve?
HASSETT: Well, there might be some increase in prices. But the fact is that if we’re going to be a heavy burden on the U.S. consumer, then this trade deficit that for 30 years we’ve seen really since China entered the WTO would be something that would have gone down. It would have gone down over time. It would have responded to the prices.
The bottom line is that China entered the WTO in 2000. In the 15 years that followed, realincomes declined about $ 1,200 cumulatively over that time.
And so, if cheap goods were the answer — if cheap goods were going to make Americans real wages, real welfare better off, then real incomes would have gone up over that time. Instead, they went down because wages went down more than prices went down.
So, we got the cheap goods at the grocery store, but then we had fewer jobs. And that’s why President Obama and Chuck Schumer and Nancy Pelosi and President Trump have come out saying, we’ve got to come up with a better policy, a policy that treats our workers fairly compared to everybody else. And now, President Trump, true to his word, just like he promised during the campaign, just like he put into his campaign platform, he’s delivering on his word.
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