U.S. Treasury Secretary Scott Bessent has amplified calls for a sweeping review of the Federal Reserve, arguing the central bank’s “many mistakes” — particularly its opposition to former President Donald Trump’s tariff policies — warrant institutional scrutiny. Speaking to CNBC on Monday, Bessent criticized the Fed for what he called “fear-mongering” over tariffs, which Chair Jerome Powell once warned risked higher inflation and unemployment. “Thus far, we’ve seen very little if any inflation,” Bessent said, dismissing concerns. “All those PhDs over there, I don’t know what they do.”
The remarks mark the latest escalation in a long-running clash between Trump-aligned officials and the Fed. Bessent did not outline specifics for a potential review but likened the need for accountability to probes conducted after transportation failures, stating, “If this were the FAA and we were having this many mistakes, we would go back and look at why this happened.” He defended Trump’s trade strategy, describing the former president as a “high-functioning executive” whose tariffs pressure foreign governments into renegotiating deals favoring U.S. interests.
Trump’s tariff regime, launched in April, imposed a baseline 10% levy on most imports, with higher rates targeting China, Mexico, Canada, and the EU. Additional sector-specific measures are reportedly under consideration. The administration framed the policy as a tool to bolster domestic manufacturing, secure jobs, and reduce trade deficits, though critics warned of retaliatory measures and economic strain. While some partners initially resisted, many have since engaged in talks for revised agreements, according to the Treasury.
The Fed’s monetary policy has also drawn Trump’s ire. Despite June’s consumer price data showing a 2.7% annual inflation rate — aligning with expectations — Trump renewed demands for rate cuts, posting on Truth Social: “Consumer Prices LOW. Bring down the Fed Rate, NOW!!!” He has repeatedly accused Powell of exacerbating U.S. debt costs by maintaining elevated borrowing rates and called for greater presidential influence over monetary decisions.
Bessent’s critique adds to concerns about political pressure on the Fed’s independence. Economists note that while inflation remains moderate, the long-term impact of tariffs and fiscal policies could strain supply chains and consumer prices. The central bank, meanwhile, has emphasized data-driven decision-making, with Powell reiterating its mandate to balance maximum employment and stable prices. As debates over trade and monetary policy intensify, the call for a Fed review underscores deepening fissures between Washington’s economic policymakers.
