President Trump likes to keep his cards close to his chest. His “allies” keep getting in the way.
And one high-ranking Trump official just uttered eight words on CNN that’s landed them in hot water.
Trump Tariffs Spark Price Hike Fears, But Administration Touts Inflation Wins
President Donald Trump’s tariffs have ignited a debate over their impact on American consumers, with Treasury Secretary Scott Bessent acknowledging on Sunday that the levies could lead to higher prices. Speaking on CNN’s State of the Union, Bessent addressed concerns raised by Walmart CEO Doug McMillon, who warned that the retail giant might pass tariff-related costs on to shoppers. The Trump administration, however, is highlighting recent declines in inflation and gasoline prices as evidence of its economic stewardship.
Walmart’s McMillon, during a Thursday earnings call, announced price increases tied to the tariffs, despite the company reporting strong quarterly sales and a rise in operating profit. The retailer faced a slip in first-quarter profits, prompting McMillon to signal potential cost pass-throughs. Bessent, who spoke with McMillon on Saturday, offered context for the CEO’s remarks. “I did speak to Doug McMillon, who I have a very good relationship, yesterday, just to understand what he had to say. And, you know, understand that came from an earnings call. On an earnings call, because of [Securities and Exchange Commission] requirements, they have to give the most draconian case,” Bessent said.
Bessent emphasized that Walmart plans to absorb some tariff costs, though he conceded that “some may get passed on to consumers.” He quickly pivoted to the administration’s economic achievements, noting, “The other thing that’s happening is that inflation is down. We had the first drop in inflation in four years under President Trump.” The Treasury Secretary’s comments align with a Tuesday report from the Bureau of Labor Statistics, which showed inflation easing to its lowest level since February 2021.
The administration’s focus on falling inflation was echoed in Bessent’s discussion of consumer priorities. “The other thing that Doug mentioned to me is for his consumers, for his buyers, the most important thing are gasoline prices. And this administration has gotten gasoline prices down, service prices are down,” Bessent said. He acknowledged lingering consumer unease, stating, “I don’t blame consumers for being skittish after what happened to them four years under Biden. We had the worst inflation in 40 years.”
President Trump, however, took a firm stance against price hikes. In a Saturday Truth Social post, he demanded that Walmart refrain from raising prices. “Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain. Walmart made BILLIONS OF DOLLARS last year, far more than expected,” Trump wrote. “Between Walmart and China they should, as is said, ‘EAT THE TARIFFS,’ and not charge valued customers ANYTHING. I’ll be watching, and so will your customers!!!”
Not all Republicans share Trump’s optimism about shielding consumers. Sen. Rand Paul, appearing on ABC’s This Week on Sunday, argued that tariffs inevitably raise costs. “Well, tariffs are taxes, and when you put a tax on a business, it’s always passed through as a cost,” Paul said. “So, there will be higher prices.” His remarks highlight a tension within the GOP over the administration’s trade policies.
Bessent, meanwhile, outlined a nuanced approach to tariffs, telling State of the Union that the administration is pursuing “a lot of regional deals.” According to Axios, this includes setting varied tariff rates for regions like Central America and parts of Africa, with a focus on “the 18 important trading relationships.” The Treasury Secretary’s comments suggest a tailored strategy to balance trade goals with economic stability.
Recent trade developments point to this approach. Following negotiations in Geneva, the U.S. and China significantly reduced tariffs on each other, a move that follows China’s efforts to expand trade with Vietnam, Malaysia, and Europe after Trump’s “Liberation Day” tariff rollout in April. The temporary de-escalation signals progress in managing global trade tensions.
Trump, speaking on Friday, indicated that his administration would soon notify certain countries of their specific tariff rates via letter, as reported by Fortune. He noted the impracticality of negotiating individually with every nation affected by the tariffs, reflecting the scale of the administration’s trade agenda.
Public sentiment, however, remains mixed. A Reuters/Ipsos poll published April 23 found that only 37% of Americans approved of Trump’s economic management, suggesting challenges in winning over voters. The tariffs’ potential to raise prices for everyday goods, like children’s toys, has drawn scrutiny.
Political observers have noted the administration’s messaging struggles. On May 5, analyst Mark Halperin, former Democratic strategist Dan Turrentine, and former White House press secretary Sean Spicer argued that Democrats have failed to exploit Trump’s remarks about tariffs potentially leading to “fewer and more expensive dolls.” The comment, they suggested, could have been a political liability if leveraged effectively.
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