President Donald Trump’s top economic adviser, Kevin Hassett, sharply criticized Federal Reserve Bank of New York economists last week over a study concluding that U.S. companies and consumers are absorbing nearly all costs associated with the administration’s 2025 tariff increases. The remarks, delivered in a CNBC interview and first reported by MyNorthwest, have drawn national attention to questions about economic independence and the financial pressures facing households.

The New York Fed research, published last week on its Liberty Street Economics blog as “Who Is Paying for the 2025 U.S. Tariffs?”, found that American importers—and ultimately consumers—were paying roughly 90% of Trump’s tariff increases. According to the analysis, average U.S. tariffs rose from 2.6% to 13% over the course of last year, with only marginal price reductions from foreign exporters.

Hassett called the report “an embarrassment” and stated that the economists involved “should presumably be disciplined,” marking another high-profile confrontation between the administration and the traditionally independent Federal Reserve system. The White House has repeatedly disputed findings that U.S. consumers bear the cost of tariffs, despite similar conclusions from multiple research institutions, including a joint Harvard–University of Chicago study published through the National Bureau of Economic Research, a tariff impact analysis by the Kiel Institut in Germany, and a recent Congressional Budget Office report.

For Southwest Washington, the stakes behind the national dispute are practical rather than political. The region’s economy relies heavily on consumer spending, manufacturing, and freight-dependent businesses. Higher import costs have the potential to affect everything from local furniture and appliance prices to supply costs for small manufacturers across Cowlitz County. While no local-specific tariff impact data has been released, the national findings mirror concerns expressed by several business groups across Washington state over the past year regarding rising input costs and unpredictable pricing.

Economic pressure points are already visible in areas such as housing materials, automobile parts, and grocery supply chains—sectors with a strong footprint in Longview and Kelso. In a community where inflation concerns remain top-of-mind, the confirmation that tariffs function as a consumer-facing tax, whether intentional or not, adds another layer of uncertainty for households navigating tight budgets.

The broader tension between the White House and the Federal Reserve also carries long-term implications. The Fed’s ability to conduct independent economic research has historically been treated as a cornerstone of its credibility. Public criticism from senior administration officials may fuel questions about how policymakers across federal agencies will handle economic data in an election year, particularly research that points to rising costs borne by consumers.

For now, the Federal Reserve Bank of New York stands behind its findings. Its analysis is consistent with years of economic literature on tariff incidence, including similar research from nonpartisan institutions. As households across Southwest Washington continue grappling with elevated grocery, housing, and transportation costs, the debate unfolding in Washington, D.C. is likely to influence both the national conversation and the practical realities facing families and businesses along the I‑5 corridor.

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