Ultra-rich Trump official says consumers won’t notice price increases, leaves CNBC hosts speechless

"Nobody's gonna actually notice it at the end of the day."


Wilbur Ross left CNBC hosts dumbfounded on Tuesday morning after he argued American families won’t notice the additional tariffs the Trump administration is slapping on Chinese goods because the price increases will be spread across so many products.

Trump announced on Monday that he will impose a 10 percent tariff on $200 billion of Chinese imports starting later this month, which will result in Americans paying more for products like air conditioners and lamps.

“Mr. Secretary, the average American family, making $50,000 a year, let’s say — how much do you expect these tariffs will impact them?” one of the CNBC hosts asked Ross. “Have you done that math so you know what an average family in America will pay once these tariffs go into effect?”

Ross, who was worth $2.9 billion in 2016, argued that the impending price increases aren’t actually a big deal.

“If you have a 10 percent tariff on another $200 billion, that’s $20 billion a year. That’s a tiny, tiny, tiny fraction of 1 percent total inflation in the U.S.,” Ross said. “Because it’s spread over thousands and thousands of products, nobody’s gonna actually notice it at the end of the day.”


But that’s not how economics work — and the hosts seemed dumbfounded by Ross’ claim that price increases don’t matter, stammering for a few seconds before changing the topic.

China, unsurprisingly, has already threatened to retaliate in response to Trump’s latest escalation in his global trade war.

Shortly after Ross’ interview wrapped up, President Trump expressed confidence that American farmers will endure hardship created by his trade war because “these people are great patriots.”

But as the Washington Post details, it doesn’t seem that Trump understands exactly how tariffs work:

At the White House [on Monday], Trump wrongly said that “China is now paying us billions of dollars in tariffs” and he celebrated the Treasury Department collecting “tremendous amounts of money, which is great for our country.”

In fact, tariffs are taxes that are paid by Americans who import goods from abroad. Through the end of August, the administration had collected nearly $22 billion in revenue because of its new tariffs, according to the nonpartisan Tax Foundation.

Trump has repeatedly indicated that the goal of his trade war is to persuade companies to relocate production to the U.S. But so far, companies like Apple have indicated that they will instead raise prices on U.S. consumers.

Even the right-wing Tax Foundation concluded Trump’s tariffs will wipe out a significant percentage of any economic gains resulting from tax cuts for the wealthy that Republicans passed late last year. There are already some indications that wages aren’t keeping up with inflation, which will only become more of a problem as Trump imposes new tariffs on more imported goods.

Tuesday was not the first time Ross made a case that American consumers won’t notice any price increases resulting from Trump’s trade war. During an interview on Fox Business last month, Ross swatted down the suggestion that tens of billions of dollars of tariffs on Chinese goods will hurt the American economy because, as he claimed, “$50 billion on an $18 trillion economy is three-tenths of one percent. It’s not something that’s going to be cataclysmic.”

More memorably, during a CNBC interview in May, Ross waved around cans of soup and Coke in an effort to make his case.

“This is a can of Campbell Soup. In the can of Campbell Soup, there’s about 2.6 cents, 2.6 pennies worth of steel, so if that goes up by 25 percent, that’s about 6/10 of one cent on the price of Campbell Soup,” Ross said. “Well, I just bought this can today at a 7-Eleven down here, and the price was $1.99. So who in the world is going to be too bothered by 6/10 of a cent?”