Hassett Torches the NY Fed Tariff Priests, and the Swamp Clutches Its Pearls

You could smell it through the screen: that special panic perfume that only appears when a public-facing economics write-up gets treated like holy scripture, and somebody in the White House says, “Nope.”

That’s what happened after Kevin Hassett, director of the White House National Economic Council, went after a New York Fed tariff study and said the people behind it should be disciplined. The press reacted like he’d thrown a brisket at the Mona Lisa.

What the New York Fed said (Feb. 12, 2026)

On February 12, 2026, the Federal Reserve Bank of New York published a Liberty Street Economics post asking who is paying for the 2025 tariffs.

• Main claim: nearly 90 percent of the economic burden fell on U.S. firms and consumers.
• Basis: import data through November 2025, plus their analysis of import prices and duties.
• Tariff level shift: they said the average tariff rate on U.S. imports rose from 2.6 percent to 13 percent over the course of 2025.

The post also noted the share borne by foreign exporters rose some later in 2025, but the headline conclusion still landed hard: most of the burden showed up domestically.

What Hassett said (Feb. 18, 2026)

On February 18, Hassett went on CNBC and blasted the post, calling it partisan and sloppy. He also said the authors should be disciplined. That’s the flashpoint: a political appointee publicly punching back at a public Fed research product that got pulled straight into the tariff narrative.

Why the word “disciplined” detonated

Washington’s pearl-clutching is acting like “discipline” is a medieval torture device. In reality, discipline is what happens when powerful institutions publish conclusions that immediately shape a national policy brawl.

And it’s not like the New York Fed post pretended firms would sit still. It discussed firms reorganizing supply chains in response to higher import prices. That matters because tariffs are not just about measuring price pass-through. They are also about what happens when the pressure forces choices.

Revenue, incidence, and the real argument

The Associated Press reported the government has collected nearly $100 billion in tariff revenue since October. Duties get paid at the border, but the fight is always incidence: who ultimately eats the cost, exporters or importers, and how it filters through prices.

The New York Fed post says Americans eat most of it. Hassett says the post is flawed and that the broader picture matters. That clash is not a constitutional crisis. That is politics colliding with economics in public, exactly where both sides chose to operate.