A former White House economic advisor is warning that President Donald Trump is about to lose control of the U.S. economy.
“Remember 2025, when President Trump dictated bracing new rules for the economy? Impose sweeping tariffs! Dismantle government agencies! Lower taxes! Cut spending! The Federal Reserve remained independent, but almost everyone else fell in line. That may soon feel like ancient history,” former White House Council of Economic Advisors Jason Furman wrote Wednesday in the New York Times.
“Because in the first couple of months of this new year, the power shifts,” continued Furman. “The Supreme Court is expected to rule on both the Trump administration’s huge slew of tariffs and the president’s ability to control the Federal Reserve Board. In addition, a new nominee to lead the Fed will be handed over to the Senate for scrutiny. Meanwhile, Congress no longer seems to be listening to Mr. Trump on taxes and spending — and might even start enacting its own agenda.”
The Supreme Court’s upcoming tariff decision may be the first of major “seismic events,” said Furman. The Court is expected to rule in the coming days or weeks, possibly fully endorsing or rejecting the administration’s rationale, or at least paring down Trump’s disputed authority to levy new import taxes on Americans and U.S. business.
“If some tariffs stay in place, businesses that have so far absorbed much of the costs may no longer be able to shield consumers from higher prices,” warned Furman. “Trading partners may reconsider their agreements — or retaliate against U.S. products. And if any tariffs are struck down, the administration will almost certainly try to reimpose them using alternative legal authorities, which will set off still more litigation.”
And in August, the court will consider Trump’s claim of unilateral power to fire Federal Reserve governor Lisa Cook and Fed Chair Jerome Powell.
Congress, itself, may finally be prepared to reclaim some power Republicans happily conceded to Trump. Resulting “affordability” issues caused by Republicans’ combined policies with Trump are driving the GOP to reconsider Affordable Care Act (ACA) subsidies Republicans let expire on January 1, forcing approximately 22 million people to pay higher health insurance premiums ahead of this fall's midterms.
“These questions come at a moment when the state of the economy is already unusually uncertain,” said Furman, with the risk of recession remaining elevated, lingering inflation an the possibility of the artificial intelligence industry collapsing.
“I find myself wishing for something like Mr. Trump’s decisiveness from 2025 — but only if it could be paired with something it fundamentally lacked: wisdom,” said Furman said. “Instead, we may get a messy, fragmented system in which power is shared among nine Supreme Court justices, 12 Federal Reserve voters, 535 members of Congress, and millions of businesses and households making their own decisions.”
“I would settle for that,” added Furman. “A stalemate, even an untidy one, is preferable to Mr. Trump wielding unilateral control over the economy."
Read Furman's New York Times op-ed at this link.