Adriano Espaillat Asks CBO Official: Will Consumer Goods Be More Or Less Expensive With Trump’s Tariffs?

Forbes Breaking News

During a House Appropriations Committee hearing prior to the congressional recess, Rep. Adriano Espaillat (D-NY) questioned Dr. Phillip L. Swagel, the Director at the Congressional Budget Office, about the effect of President Trump’s tariffs.

Transcript

00:00Mr. Espioff for his five minutes.

00:03Thank you, Mr. Chairman.

00:04Mr. Swaggo, we are living in a cost-to-living crisis with great economic uncertainty,

00:13and the families that I represent are afraid of what will come next.

00:19The president's reckless tariffs against our neighbors and allies have presented this uncertainty,

00:28and the markets really continue to tumble as early as this morning.

00:35You wrote in December that higher tariffs will increase federal receipts,

00:39but in your letter, you also explained the negative effects on the economy of higher tariffs.

00:46Those economic effects are what really matter to the people that I represent.

00:51Though there is a very high degree of uncertainty surrounding the administration's recent announcements,

00:57I would like you to give us a nonpartisan expert opinion on what you should expect.

01:06The question is, under President Trump's tariff policy,

01:10should we expect the price of consumer and capital goods to be more expensive or less expensive?

01:17Okay. Thank you, sir.

01:19Yes, we're analyzing the tariff announcements.

01:21And to directly answer the question, the price of consumer goods,

01:26the things bought by families, by households, and the prices paid by businesses will go up.

01:31The tariffs will reduce the efficiency of the economy, lead to lower incomes.

01:40And so what does that mean in real terms for someone that wants to purchase television,

01:46go to the supermarket and buy food, what does that mean to the American public that often it's living on fixed income

01:56or having a hard time making ends meet?

02:00Right.

02:00The prices of the things that families buy will rise, and family incomes will go less far.

02:07And then businesses will see the prices of their inputs go up,

02:10and that will tend to reduce business investment.

02:15That will reduce hiring and reduce the strength.

02:17So this is really reckless, and it is manifested every day as the markets continue to tumble.

02:23And the kind of increase that you're asking for will lead us to get additional staffing

02:28so that we can make these kinds of impartial, nonpartisan analysis on the economy, correct?

02:35That's correct.

02:36The additional staff would help us do this kind of analysis.

02:38And you're asking for 15 additional staffers, right?

02:42That's correct.

02:43And another question that I had regarding that,

02:45because I know that one of the areas where you have expressed a keen interest in is the health arena, right?

02:53And health, in many ways, is also part of the economy,

02:56because the cost of health care is so high that it impacts on real pocketbook issues.

03:04And so I want to know, like, as we move forward and these tariff war continues to wreck our economy,

03:13and we continue to see an effort to potentially cut Medicaid and Medicare from the American people,

03:23two vital programs, really life and death issues,

03:26because if I have Medicaid and all of a sudden my benefits are cut, it's a life and death decision.

03:33Do you foresee these 15 new folks doing an analysis on the impact on the cuts of Medicaid and Medicare

03:40as it pertains to the potential tax cuts for the very rich?

03:46Yes, the people I would look to add, first and foremost, would be in health.

03:53We do analysis of all the programs you mentioned, Medicaid, Medicare, pharma, veterans' health,

03:59and I would add experts in that because there's intense congressional interest.

04:04And these programs are very costly, right?

04:08So it's almost impossible to save money so that you can give a tax break to the very rich

04:13without touching these vital programs like Medicaid, Medica, and I dare to say even Social Security.

04:20I mean, you've pointed to the elements of the fiscal challenge,

04:24the health care programs, Social Security, Medicare, and then revenues on the tax side,

04:29and those are the decisions Congress would have to make in choosing how to address the fiscal challenge.

04:35And we would provide that analysis, including of the tradeoffs that you are pointing to.

04:39So I would look forward to making sure that you have the additional tools and additional staffing

04:45to ensure that we make these kinds of nonpartisan analysis, I think,

04:50that will guide us in the right direction as the stewards of our budget

04:56and having the constitutional responsibility or the power of the purse

05:01to make the right decisions and protect table and pocketbook issues for the American people.

05:07Thank you, Mr. Swagel, and I yield back.

05:09Thank you, sir.

05:10Thank you, Mr. Espiot.

05:11Thank you, Mr. Espiot.

Category

Transcript

Recommended