• Kevin Hassett, a former economic advisor, demands disciplinary action against authors of a NY Federal Reserve study showing U.S. firms and consumers bear 90% of tariff costs.
  • The study, published in February 2026, contradicts Trump's claims that foreign countries shoulder the burden, sparking political tensions.
  • Analysts warn that such criticism could undermine institutional independence and influence future economic policy debates.

A Controversial Critique

Kevin Hassett, a prominent economist and former advisor, has publicly called for the authors of a recent New York Federal Reserve tariff study to be disciplined, alleging political bias in their research. According to people familiar with the matter, Hassett made these remarks in a private briefing earlier this week, arguing that the findings misrepresent the economic impact of tariffs and could sway public opinion unfairly.

The study, published in February 2026 by economists including Mary Amiti, Chris Flanagan, Sebastian Heise, and David E. Weinstein, concludes that 90 percent of the economic burden from tariffs imposed during the Trump administration fell on U.S. companies and consumers through November 2025. This contradicts claims by former President Trump that foreign exporters absorb the costs, aligning with what economists describe as the "overwhelming consensus" on tariff mechanics.

Institutional Tensions Rise

Efforts to restructure the narrative around tariffs have hit a snag, with Hassett's criticism highlighting deep divisions within economic circles. In a statement paraphrased by sources, Hassett emphasized that the study's methodology fails to account for broader trade benefits, though he did not provide specific evidence. Attempts to reach the study authors for comment were unsuccessful, but a spokesperson for the NY Fed declined to address the disciplinary call directly, noting only that the research underwent standard peer review.

Market reactions have been muted, with the S&P 500 holding steady in early trading today, but analysts caution that such public disputes could erode trust in federal institutions. Without a balanced dialogue, the debate risks polarizing economic policy further, potentially affecting upcoming legislative discussions on trade.

Implications for Policy and Perception

The controversy underscores ongoing challenges in separating economic analysis from political rhetoric. As negotiations over future tariff policies continue, this incident may prompt stricter scrutiny of federal research outputs. Some industry insiders suggest that partnerships between academic and governmental bodies could face increased pressure to align with political agendas, though others argue for maintaining rigorous, independent standards.

In a brief update, sources indicate that Hassett's team has not filed a formal complaint, leaving the disciplinary demand as a rhetorical point for now. The situation remains fluid, with potential clarifications expected from involved parties in the coming days.