Trump Economic Adviser "Focus on Tariffs... No Short-Term Negative Impact Expected"

"The Burden of Tariff Increases Will Fall on Other Countries"

Steven Mnuchin, Chairman of the White House Council of Economic Advisers (CEA) and economic advisor to U.S. President Donald Trump, assessed the likelihood of short-term negative impacts on the U.S. economy due to tariff increases as low. He argued that the tariff burden is passed on to countries that sell goods to the United States.

On the 24th (local time), Mnuchin stated in an interview with Bloomberg Television, "I do not think there will be material pain in the short term due to tariffs."

Steven Muren, Chair of the White House Council of Economic Advisers (CEA). Photo by AP Yonhap News

He added, "American consumers are flexible," and "We have options. We can produce goods domestically."

Mnuchin predicted that countries other than the U.S. would bear the pain caused by the U.S. tariff increases. He said, "Countries that sell to the U.S. have no flexibility because they can only sell to the U.S.," adding, "Therefore, they will bear the tariff burden, which means the risk of economic downturn or price pass-through of tariffs will be very limited."

Regarding the specific details of the reciprocal tariffs to be announced on the 2nd of next month, he avoided answering, saying, "It would be wrong for me to get ahead of myself."

Mnuchin identified the short-term challenge facing the U.S. economy not as tariffs but as moving away from dependence on the public sector. He explained, "Three-quarters of U.S. job growth over the past two years has come from government spending and taxpayer subsidies," adding, "As this shifts to the private sector, the economy will become vulnerable."

In November last year, Mnuchin released a report titled "User Guide for Restructuring the Global Trade System," which resonated on Wall Street. In the report, he proposed a global currency agreement as one of the solutions to address the U.S. current account deficit. Mnuchin argued that by properly adjusting foreign exchange markets, adverse effects such as price increases could be minimized even if tariffs are imposed.

When asked how much of the policies proposed in the report have been realized, Mnuchin dismissed it as merely a cookbook presenting options to President Trump. He emphasized that President Trump is the chef who ultimately chooses which ingredients to use, distancing the report from claims that it is the source of the policy agenda.

Regarding the possibility of a so-called Mar-a-Lago agreement or similar foreign exchange accord being concluded next year, Mnuchin stressed that President Trump's priority is tariffs, but added that there is a possibility of discussions in the future.

This content was produced with the assistance of AI translation services.