Hassett says Fed staff should be 'disciplined' for reporting the US pays tariff costs
www.politico.com

... White House economic adviser Kevin Hassett on Wednesday said staffers at the New York Federal Reserve should be punished for producing research that found most of President Donald Trump's tariffs are being paid by U.S. firms and consumers.

Hassett on CNBC called the paper, co-authored by four people including the New York Fed's head of labor and product markets, "an embarrassment" and "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," he added.

Hassett, the director of the National Economic Council, was previously on Trump's short list to be the next chair of the Fed, but the president ultimately selected former Fed board member Kevin Warsh.

"Prices have gone down. Inflation is down over time," Hassett said. "Import prices dropped a lot in the first half of the year and then leveled off, and [inflation-adjusted] wages were up $1,400 on average last year, which means that consumers were made better off by the tariffs. And consumers couldn't have been made better off by the tariffs if this New York Fed analysis was correct." ...

The Affordability Crisis Can Now Add Wages To The Mix
www.fa-mag.com

... No matter the economic survey or poll, the message is the same thing: Americans are deeply concerned about what they call an affordability crisis. Yet to former hedge fund manager and current Treasury Secretary Scott Bessent, it's a joke"literally.

Asked what could be done to get Americans feeling better about the economy during recent testimony in the Senate, Bessent quipped that consumers could "turn off MSNBC," the left-leaning cable news network now called MS NOW. The response drew several loud laughs from those in attendance.

Perhaps Bessent wouldn't have been so flippant if the testimony had come after the flood of data last week, which laid bare the challenges facing ordinary Americans, especially the rapidly diminishing leverage of workers.

A measure of wages for employees in the private sector rose 3.3% in the fourth quarter from a year earlier, the Labor Department's quarterly Employment Cost Index report showed last Tuesday.

It was the smallest increase since early 2021, when the unemployment rate was still well above 6% as the fallout from the Covid-19 pandemic lingered. ...