Trump cabinet pick dismisses 'nonsense' claim that tariffs cause inflation
President Trump's pick to lead the Commerce Department, Howard Lutnick, is pushing back on one of the biggest criticisms of Trump's economic plans.
During a Senate confirmation hearing, Lutnick, a strong supporter of Trump's protectionist agenda, dismissed "nonsense" claims that Trump's tariffs will spur inflation.
Trump nominee defends tariffs
Tariffs have been a centerpiece of Trump's "America First" agenda since he got into politics, but the president's critics have claimed that tariffs pass costs along to consumers, likening the effect to a sales tax.
Lutnick, a friend of Trump and a Wall Street executive, disputed the claim during a Senate Commerce, Science and Transportation Committee hearing, pointing to India and China as examples of high-tariff countries.
"The two top countries with tariffs, India and China, do have the most tariffs and no inflation," Lutnick said.
"A particular product's price may go up," he added. "It is just nonsense to say that tariffs cause inflation. It’s nonsense."
"Treated horribly"
During his testimony, Lutnick echoed Trump's familiar lament that America is getting ripped off by its trade partners.
"We are treated horribly by the global trade environment, everybody has higher tariffs, non-tariff trade barriers and subsidies," Lutnick said. "We can use tariffs to create reciprocity, fairness and respect."
Lutnick also said he prefers blanket tariffs on a country-by-country basis, as opposed to targeting specific products.
"I think when you pick one product in Mexico, they'll pick one product. You know, we pick avocados, they pick white corn, we pick tomatoes, they pick yellow corn. All you're doing is picking on farmers," he said.
Trump confirms tariffs coming
Trump has long supported using tariffs to reduce trade deficits and protect American jobs. He has successfully used the threat of tariffs as a pressure tactic, squeezing Colombia last weekend into reversing course after the country refused to take back deportees.
Trump confirmed Thursday that he will impose 25% tariffs on Canada and Mexico starting Saturday, as he promised to do, citing their failure to control their borders with the United States. The president is also considering 10% tariffs on China over the country's role in the fentanyl trade.
“Look, Mexico and Canada have never been good to us on trade,” he said. “They’ve treated us very unfairly on trade and we will be able to make that up very quickly because we don’t need the products that they have.”