Fed Executive Tags Hassett’s Outburst as Meddling

Minneapolis Fed President Neel Kashkari has voiced concerns about interference in Federal Reserve affairs by Kevin Hassett.

Kashkari described Hassett's actions as "another step to try to compromise the Fed’s independence." (Photo: Federal Reserve Bank of Minneapolis) 

“This is just another step to try to compromise the Fed’s independence,” Kashkari said at an event in Fargo, North Dakota, Elisabeth Buchwald reported for CNN.

Hassett argued that the research in question focused only on price-related effects of tariffs and not on changes in import volumes. However, that characterization is incomplete.

In assessing tariff burdens, the authors calculated average duty rates by dividing total monthly tariff revenue by the total value of imports in a given month, meaning import volumes were factored into the analysis.

They also examined how global supply chains shifted in response to higher tariffs, according to reporting by Christopher Rugaber of the Associated Press (AP) and Victoria Guida of Politico.

“All 12 Reserve Banks have independent research departments that are always studying the economy,” Kashkari said.

“That is how we’re trying to get better and learn.”

Like Fed officials who vote on interest rate decisions, Fed researchers work to maintain independence from political influence.

Their research informs policymakers by providing a clearer view of current and future economic conditions, though researchers themselves do not make policy recommendations.