Despite the Federal Reserve's aggressive interest rate hikes, which have resulted in some of the highest rates globally, Kevin Hassett, Director of the National Economic Council, stands firm in his belief that the U.S. economy is thriving under President Trump's leadership. In a recent interview with CNBC's "Squawk Box," Hassett boldly stated, "The economy is booming right now because of Trump's policies." He emphasized that the Fed's tight monetary policy, including its high interest rates, has not hindered economic growth.
However, Hassett acknowledged that the Fed's actions have caused frustration within the administration. "The Fed has amongst the highest interest rates on Earth, and President Trump is not pleased with that," he said. He further clarified that this frustration is unrelated to the Department of Justice's decision to pursue a "criminal indictment" against Fed Chair Jerome Powell.
When asked about the Fed's role in the positive economic developments, Hassett pushed back, calling for central bankers to reflect on their actions. "We let inflation get out of control," he pointed out, referring to the peak 9.1% year-over-year inflation in 2022, the highest since 1981. "It's important to understand how that happened and to have a plan to prevent it from occurring again."
Hassett highlighted strong growth and factory activity as evidence of the administration's successful policies. "We've seen GDP rise to over 5% in the fourth quarter, up from 2.4% the previous quarter," he said. "Trump's policies are delivering results."
But here's where it gets controversial. The latest jobs report from the U.S. Bureau of Labor Statistics paints a different picture. Employers added just 584,000 jobs in 2025, a significant decline from the 2 million jobs added in 2024. This, coupled with the weakest annual wage growth outside of a recession since the early 2000s, raises questions about the impact of Trump's trade and tariff policies.
Mark Zandi, Chief Economist at Moody's Analytics, attributes these job losses to Trump's tariffs. "This reflects the direct effects of the tariffs on manufacturing, transportation, and distribution," Zandi said. Joel Griffith, a Senior Fellow at Advancing American Freedom, noted that the manufacturing sector has experienced eight consecutive months of job losses, starting in April when Trump's "Liberation Day" tariffs were announced. "Trump's tariffs are having a detrimental effect on the very sector they were supposed to save," Griffith stated.
So, is the U.S. economy truly booming, or are there underlying issues that need addressing? What do you think? Feel free to share your thoughts and opinions in the comments below!
