WH Economic Council Director Kevin Hassett: More Than 50 Countries Started Trade Negotiations This Weekend
Posted By Tim Hains On Date April 6, 2025

GEORGE 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?

KEVIN 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 USTR 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, real incomes 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.

STEPHANOPOULOS: Right, but you also -- he also said prices were going to come down and he just conceded the prices are going to go up,

Also on Truth Social, the president retweeted a post that said the market drop was part of a deliberate strategy to force the Fed to lower interest rates. Is that the president's strategy? If not, why did he post it?

HASSETT: Yeah -- that -- you know, the bottom line is the president has been talking about tariffs for 40 years and this is like been absolutely the policy that he's focused on in the campaign and throughout his political career. And you know, the cyclical cycle of the Fed, it comes and goes. That's a different matter.

But this is President Trump's desired policy. He's been arguing for it ever since. I think he was on “The View” 30, 40 years ago, and it's exactly -- the baseline tariff is exactly what he -- he put into the convention.

STEPHANOPOULOS: But is it his strategy --

HASSETT: So, this is not a surprise for anyone.

STEPHANOPOULOS: Is it his strategy to force the Fed to lower interest rates, and that the market crash was part of that strategy?

HASSETT: We understand the Fed is an independent agency. We respect the independence of the Fed. But the president's allowed to have an opinion. The -- absolutely, the president's allowed to have an opinion but there's not going to be any political coercion over the Fed, for sure.

STEPHANOPOULOS: So -- so that is his strategy? Tank the market so the Fed will lower interest rates? Well, you just said the president's allowed to have an opinion. Is that his opinion or not?

HASSETT: He's not trying to tank the market. He's trying to deliver for American workers.

And -- I mean, what would you have him do? Again, real wages down 15 years in a row under the previous policy, and that's why Americans voted for him. They brought him in to turn the economy around for the American worker, and that's what he's focused on.

STEPHANOPOULOS: I'm -- I'm just trying to get some clarity. Is that the strategy --

HASSETT: I’m going to give clarity.

STEPHANOPOULOS: No, is that the president's strategy or not? He posted it. He said the strategy is to lower to -- for the markets to crash so the Fed lowers interest rates. Is that the president’s strategy?

HASSETT: It's not a strategy for the markets to crash. It is not a strategy for the markets to crash. It's a strategy to create a golden age in America for the American worker. That's his strategy.

STEPHANOPOULOS: JPMorgan says the risk of a recession has climbed to 60 percent. Your response?

HASSETT: We just had one of the stronger jobs reports I've seen in a long time. It was about 50 percent better than markets expected. It's the second one in a row. We've created already something like 10,000 auto jobs since President Trump took office, and I just got word -- anecdotal word last night that auto plants are adding second shifts in the U.S. in order to respond to these tariffs these days.

STEPHANOPOULOS: Well, we've also seen auto companies like Stellantis say they're having layoffs.

HASSETT: There's -- we've got the data. We just got the data for last month or the month before, both times, manufacturing employment went up, and auto employment went up. And again, we're looking at about 10,000 auto jobs. George, that's more than we got all of last year with Joe Biden.

STEPHANOPOULOS: That's looking back. But looking forward, Stellantis did say this week they were laying off workers. They did.

HASSETT: The reason that they were starting it in the last two months was they anticipated the tariffs that were announced this week and they're starting to ramp up in anticipation of that.

I would expect that the jobs numbers and I'll come back and talk to you about it when they come out or going to go up by even more now that the tariffs are in place.