"Kevin Hassett, director of the National Economic Council and the current favorite to take over as Federal Reserve chairman, argued on Thursday President Donald Trump's sweeping tariffs are playing a meaningful role in tackling America's $38 trillion national debt. In conversation with billionaire David Rubenstein, the Carlyle cofounder, Hassett argued the first step to tackling the debt was to reduce it relative to target: "And we clearly are doing that with the big reductions in the deficit right now.""
"Hassett continued, saying he's not only bullish about growth in the economy, but "the fact that we have tariff revenue and we've got a lot more spending restraint than was here in the past." He noted tariffs are an important part of Trump's economic policy and "a lot of the revenue coming in to the Treasury" is from tariffs. Hassett cast tariffs as part of a broader supply-side strategy he said he believes can boost growth, widen the tax base."
Tariffs play a role in tackling America's $38 trillion national debt by generating revenue and contributing to deficit reductions. Tariff receipts have increased notably from 2024 to 2025, roughly tripling or quadrupling prior levels and boosting Treasury inflows. Tariff revenue has been characterized as temporary by some officials, with the Congressional Budget Office estimating a $1 trillion reduction in projected savings between August and November as trade deals lowered effective tariff rates. Pantheon Macroeconomics estimated tariffs produced $100 billion less revenue than initially expected due to a sharp drop in imports from China. Claims of greater spending restraint face scrutiny from budget watchdogs.
Read at Fortune
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