U.S. Treasury Secretary Scott Bessent faced a heated confrontation with a Democratic lawmaker and acknowledged that his earlier congressional testimony may have been mistaken.
His error, Bessent insisted — despite the view of many economists — was his claim that he had not said “tariffs are inflationary.”
“Earlier,” The New York Times reported, “he had denied having written to his hedge fund investors in 2024 that tariffs are inflationary. Presented with his exact words, however, he said that he was wrong to deny making those comments and that he had been wrong at the time about tariffs and inflation.”
U.S. Rep. Sean Casten (D-IL) read from a letter Bessent wrote in 2024 — before Trump won the White House.
“I want to read you a quote,” Casten began. “‘Trump will pursue a weak dollar policy rather than implementing tariffs. Tariffs are inflationary and would strengthen the dollar.’ Do you recognize that quote?”
"I believe you're referring to a letter that I wrote, and tariffs could be inflationary," Bessent replied.
"No, no," Casten insisted. "It says 'tariffs are inflationary.'"
Casten then asked, “Do you want to correct what you said to the ranking member when you specifically said that you did not say tariffs are inflationary?”
“You said tariffs are inflationary,” Casten continued, after having to repeat himself.
“Do you want to correct what you said to the ranking member? Or did you lie?” Casten then pressed.
“If I was mistaken, I want to correct it,” Bessent said. “And I was also mistaken when I said the tariffs could be inflationary, because — we’ve seen inflation drop to 2.1 percent.”
Many economists say that tariffs are inflationary because they function as a tax, in this case, largely on American firms and consumers.
According to HuffPost, Trump's $181 billion tariff increase "ranks as the 13th biggest tax hike since before World War II."