Ahead of Trump Tariff “Liberation Day,” Warren Presses Commerce Secretary Lutnick on Tariffs As Cover for Corporate Greed-Driven Inflation
Warren sounds alarm on new data from the Fed showing chaotic Trump tariff strategy enabling price hikes for American consumers
“[Trump is] creating widespread confusion and uncertainty that may give big corporations cover to increase their prices on all goods”
Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee and Member of the Finance Committee, wrote to Commerce Secretary Howard Lutnick ahead of President Trump’s announcement on proposed reciprocal tariffs on April 2, pressing him to explain how he will prevent big corporations from using tariffs as a cover for price hikes. The letter follows new data released last week by the Federal Reserve Board (FRB) indicating that President Trump’s chaotic tariffs rollout is stalling progress on inflation and giving big corporations a new set of excuses to price-gouge American consumers.
“We should use tariffs to support American manufacturing, strengthen onshore critical supply chains, and create good-paying jobs here at home. Instead, we are seeing executives pull back on investment and threaten to impose new and unjustified price increases on consumers,” wrote Senator Warren.
Last week, FRB Chair Jerome Powell announced that the Federal Reserve System will hold interest rates at their current level, reflecting the bureau’s belief that progress towards reducing inflation has stalled. Powell noted that “a good part of [the higher inflation forecast] is coming from tariffs” and that manufacturers tend to “just follow the crowd” and raise prices, even on goods that aren’t subject to tariffs.
The Trump administration currently has no plans to prevent companies from using tariffs as an excuse to hike prices up even further, despite corporate executives’ warnings that tariffs would lead them to preemptively raise prices.
“I am deeply concerned that President Trump is now enabling this corporate greed, allowing companies to increase prices across the board, regardless of whether goods are actually subject to tariffs,” continued Senator Warren.
Big corporations have continuously threatened that tariffs would lead them to preemptively raise prices. AutoZone’s CEO said: “We’ll generally raise prices ahead of [tariffs]—we know what the tariffs will be—we generally raise prices ahead of that.” At an earnings call in mid-March, MasterBrand’s CFO said they “anticipate that wide-ranging price increases will be needed across our various products.”
Senator Warren also demanded Lutnick answer specific questions, including whether he agrees with Powell’s assessment that price increases may be a result of companies’ choosing to pass on the cost of tariffs to consumers, whether the Commerce Department has analyzed the impact of Trump’s tariffs on prices, and whether price increases have been limited to products subject to increased tariffs. Senator Warren also asked Lutnick to share specific actions Trump has taken—if any—to limit companies’ ability to pass on the costs of tariffs or impose broad price increases onto consumers.
###
Next Article Previous Article