Trump administration Commerce Secretary Howard Lutnick swatted away any notion the president's tariffs on China, Canada, and Mexico could exacerbate inflation on U.S. consumers in a CNBC "Squawk Box" interview with Joe Kernen — accusing anyone expressing this criticism of "whining and complaining."
"I mean, how much pain are we going to be willing to take in inflation if all of a sudden, they hit us right back?" asked Kernen.
"Remember, so you made one comment, so inflation comes from a government printing more money," said Lutnick, who before being appointed to the Cabinet served as the CEO of investment banking firm Cantor Fitzgerald. "Some prices can rise—"
"You don't think it can happen at all from tariffs?" Kernen pushed back.
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"No," said Lutnick. "Tariffs do not, do not, do not create inflation! Printing money creates inflation. You have a balanced budget, there can't be inflation. This doesn't mean one product can't be more expensive and one product can't be less expensive. But China, I'll give you an example, China has the highest tariffs in the world. In the world. Everything gets tariffed in China. And they don't have inflation, in fact they have deflation. India, the second highest tariffs in the world, they don't have inflation. So this concept is just people whining and complaining and not being truthful. The fact is, we need to protect America."
Inflation in India is higher than the United States. Tariffs are well documented as an inflation risk, both by businesses passing the cost of the tariffs along to consumers, and by reducing imports and limiting the supply of goods and materials generally, which puts upward pressure on prices if demand remains constant.
The potential impact of the tariffs is already being felt, with one auto dealer in Pennsylvania telling Fox News he had to raise the price of Dodge Ram trucks from $80,000 to $100,000.
