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Stephen Miran, President Donald Trumps pick to join the Federal Reserve board, said Thursday that he would remain a White House employee even if the Senate confirms him to fill an unexpired term at the central bank. Miran, who was nominated to fill a gubernatorial term set to expire in January, made the disclosure at a hearing before the Senate Banking, Housing and Urban Affairs Committee. He said that on the advice of his lawyers, he would take an unpaid leave of absence as chair of the White House Council of Economic Advisers. Miran later said he would only resign from the Republican administration if he were nominated for a longer term at the Fed. His answer instantly triggered alarm bells about the Fed’s independence, suggesting that the central bank could ultimately become subservient to Trump’s whims instead of its congressional mandates to keep prices stable and maximize employment. Political control of the Fed could erode the faith that the American population and investors worldwide place in the U.S. economy, which could threaten global markets and national prosperity. Democrats blasted Mirans plan to keep his day job at the White House. Your independence has already been seriously compromised, Sen. Jack Reed, D-R.I., said. You are going to be technically an employee of the president of the United States but an independent member of the board of the Federal Reserve. Thats ridiculous. Mirans hearing reflected the broader battle over Trumps efforts to gain control of the Fed. Because of the possible negative impacts on the economy, the Fed has tried to act based on the economic data rather than electoral considerations. Trump, however, has engaged in a prolonged campaign of pressuring and mocking Fed Chair Jerome Powell for not cutting the benchmark interest rate to Trumps liking, a move that could end up pumping more money into the economy and creating greater inflationary risks. The Fed has yet to reach its 2% inflation target and has held its rates steady in part because of the uncertainties created by Trumps import taxes. The president has also sought to apply pressure on the Fed over its renovation of its headquarters and other buildings and has tried to fire Lisa Cook as a Fed governor over allegations that she committed mortgage fraud. Cook has said she will not resign and has sued to overturn Trump’s move. Miran, in his answers to senators, played down the controversy over Trumps desire to control the Fed. Miran said that if he were confirmed to fill the rest of Adriana Kuglers term, he would act based on his own judgments about inflation and employment. Look, the president nominated me because I have policy views, that, I suppose that he liked, he said told the committee chairman, Sen. Tim Scott, R-S.C. If Im confirmed to this role, I will act independently, as the Federal Reserve always does, based on my own personal analysis of economic data. Even Republicans saw the risks to the loss of Fed independence. Sen. John Kennedy, R-La., asked Miran to commit to ignore all the rhetoric from all politicians and make his own choices. But Miran arrives with the baggage of having worked for a president who has expressed disdain for the Fed’s tradition of independence. Trump has argued that he knows more about monetary policy as he has called for the Feds benchmark rate to be cut by a full 3 percentage points. In June, a Fed forecast of future rates showed emerging divisions among the policymakers. Seven projected no rate cuts at all this year, two indicated one cut and 10 forecast at least two reductions. This is a crisis moment for the Federal Reserve, for the financial system and for the economic stability of families all across this country, Sen. Elizabeth Warren, D-Mass., told reporters before the start of the hearing. Warren added that the Fed boards independence and their efforts to make decisions based on whats really happening in the economy not what the politics are is something that benefits every single American. Donald Trump wants to burn that to the ground. Under questioning by Warren, Miran declined to say whether Trump lost the 2020 presidential election to Democrat Joe Biden, saying only that Congress certified Biden as president. Miran declined under questioning to contradict Trumps unfounded claim that the Bureau of Labor Statistics had faked jobs numbers for political reasons. Trump fired the bureau’s head after severe revisions to the July employment report showed the economy was potentially weaker than Trump’s claims of a golden age. There are also questions about how Miran interprets the Fed’s independence. He said that the president is entitled to express his opinion on monetary policy and that consideration of climate change as an economic force by Fed officials would be a politicization of the central bank. In a 2024 paper he co-wrote for the Manhattan Institute, Miran argued that the Fed was already politicized by highly political, personnel who move freely between the White House and the central banks headquarters. In that same paper, Miran wanted to heighten presidential control, saying that having Fed board members serve at the will of the president would confer greater democratic legitimacy on the Fed. By indicating that he could return to the White House, Miran seemed to undermine one of his own recommendations in his paper. To further insulate board members from the day-to-day political process, they should be prohibited from serving in the executive branch for four years following the end of their term, the paper said. Josh Boak, Associated Press
Category:
E-Commerce
President Donald Trump likes to boast about how much money the U.S. Treasury is raking in from the massive taxestariffshes slapped this year on imports from almost every country in the world. We have trillions of dollars coming into our country, Trump said Wednesday. If we didnt have tariffs, we would be a very poor nation and we would be taken advantage of by every other nation in the world, friend and foe. But two courts have now ruled that his biggest and boldest import taxes are illegal. If the Supreme Court agrees and strikes them down for good, the federal government could have to pay back many of the taxes its already collected from companies that import foreign products into the United States. Were talking about hundreds of billions of dollars potentially in refunds affecting thousands and thousands of importers, said trade lawyer Luis Arandia, a partner with the law firm of Barnes & Thornburg. Unwinding all that will be the largest administrative effort in U.S. government history. Ordinary Americans, who’ve had to pay higher prices on some products because of the tariffs, are unlikely to share in the windfall. Any refunds would go instead to the companies that paid the levies in the first place. The refunds would also reverse the flow of tariff revenue the president has counted on to help pay for the massive tax-cut bill he signed July 4 and would threaten, he warns, to literally destroy the United States of America. At issue are revenues raised from tariffs Trump imposed this year by invoking the 1977 International Emergency Economic Powers Act (IEEPA). One set of IEEPA tariffs targeted almost every country on earth after he declared that the United States massive and persistent trade deficits amounted to a national emergency. Another was aimed at Canada, China and Mexico and was meant to counter the illegal flow of drugs and immigrants across U.S. borders. But a specialized federal trade court in New York ruled in May that the president overstepped his authority by ignoring Congress and imposing the IEEPA tariffs. The U.S. Court of Appeals for the Federal Circuit last week largely upheld the trade courts decision, though it also ordered the lower court to re-consider whether there was any legal fix short of striking down the tariffs completely. The appellate judges also paused their own ruling until mid-October to give the administration time to appeal to the Supreme Court something that it did on Wednesday. Solicitor General D. John Sauer asked the justices to take up the case and hear arguments in early November. If the high court strikes down the IEEPA tariffs, importers could be entitled to refunds. The U.S. Customs and Border Protection agency reports that it had collected more than $72 billion in IEEPA tariffs through Aug. 24. For importers, Ted Murphy, co-leader of the international trade practice at the Sidley Austin law firm, said: Its a question of what youre going to have to do to get the refund. And the options are everything from nothing the government may just automatically refund it; I dont think this is likely, but thats one option. There could be an administrative process, so you have to go to U.S. Customs and Border Protection and apply for a refund of your IEEPA tariffs. Or you could have to file your own court case. Theres a precedent for courts setting up a system to give companies their money back in trade cases. In the 1990s, the courts struck down as unconstitutional a harbor maintenance fee on exports and set up a system for exporters to apply to get their money back. Companies got refunds, Murphy said. One hitch: In that case, the government did not have to pay interest on the tax it collected and had to pay back. Its unclear whether the government would have to pay interest on any IEEPA tariff refunds. The Trump administration might balk at paying back the tariffs its collected. Trump has already said he doesnt want to pay the money back, posting on his social media site in August that doing so would be 1929 all over again, a GREAT DEPRESSION! I would anticipate that if the administration did lose, they would turn around and start arguing why it would be impossible to give refunds to everybody, said Brent Skorup, legal fellow at the libertarian Cato Institute. I think there will a lot of litigation about the nature of refunds and whos entitled one. And I expect the administration will raise all sorts of objections.” To make sure they can successfully claim refunds, said Barnes & Thornburg partner Clinton Yu, importers really need to have their records in order. Adding to the uncertainty is the chaotic way that Trump has rolled out his tariffs announcing and then delaying or altering them, sometimes conjuring up new ones. Occasionally, the administration has decided that importers that have already paid one of his tariffs dont have to pay a different one. Tariff are paid by importers, who often then try to pass the cost on to their customers through higher prices. But consumers would not have recourse to ask for refunds for the higher prices they had to pay. Its the importer of record that is legally liable for paying tariffs and duties, Arandia said. They would be the only one to have standing to even get that money back. Paul Wiseman, AP economics writer AP Writers Lindsay Whitehurst and Josh Boak contributed to this story.
Category:
E-Commerce
Prepare to pay (even) more for your daily cup of joe: Coffee prices have spiked in recent months, primarily because of global supply issues, though U.S. tariffs are adding some heat to this market. Coffee futures, the global benchmark for arabica coffee, have risen more than 33% since July and nearly hit a four-month high in late August as traders have become concerned about the prospect of a slump in coffee supplies coming out of major markets like Brazil and Vietnam amid volatile weather in these regions. Conab, Brazils crop forecasting agency, this week slashed the estimate for its 2025 arabica coffee crop by nearly 5% and warned that U.S. tariffs could drive further price gains. The 50% tariffs that President Donald Trump imposed on Brazil took effect last month and put upward pressure on coffee prices, according to an August report from the International Coffee Organization. Those factors are likely to mean that consumers will have to pay even more to make coffee at home or buy a cup on the go. Ground coffee prices hit a record high of $8.41 per pound in July, up 33% from a year ago, according to the latest figures from the Bureau of Labor Statistics. After eggs, coffee experienced the second-highest inflation rate in any category of the consumer price index in July. The J.M. Smucker Co., which owns Folgers and Café Bustelo, has raised coffee prices twice this year and is likely to do so again this winter as a result of Trumps tariffs, according to reporting by The Wall Street Journal. WEATHER VOLATILITY Tariffs have become a new ingredient in a coffee market thats been roiled by weather volatility in recent years. There have been severe droughts in both Brazil and Vietnam, and these two countries are the worlds top two coffee producers, according to Bernstein analysts. But there could be some reasons to be optimistic that coffee prices will start to stabilize. Rains in Brazil could allay some of the concerns about the impact of the drought in the South American country, while the outlook from Vietnam has also improved as the country has forecasted a higher crop output for this year. Price pressures should be easing off in the near term, Danilo Gargiulo, a senior research analyst at Bernstein, told CNBC. Improving weather and capital investment to boost productivity signal lower prices ahead, while the impact of tariffs on Brazilian imports may be somewhat limited for consumers who buy coffee from the major chains, he added. BRAZIL-U.S. TRADE TALKS Finally, there could be some hope for changes on the horizon in terms of Brazil-U.S. trade negotiations. Luiz Inácio Lula da Silva, Brazils president, is convening a virtual meeting of BRICS (Brazil, Russia, India, China, and South Africa) nations next week to discuss Trumps trade policy, according to Bloomberg. The Brazilian president has repeatedly called on Trump to negotiate on trade after Trump imposed the second-highest tariffs on the nation in retaliation for its prosecution of former President Jair Bolsonaro. But Lula has also authorized a retaliation process against Trumps tariffs, in an attempt to bring the U.S. president back to the negotiation table.
Category:
E-Commerce
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