NEC Director Hassett: Biden’s Stagflation “Way Worse Than We Thought” at 4.6%; Plan: Tax Cuts, DOGE, Energy

National Economic Council Director Kevin Hassett delivered a detailed assessment of the economic situation the Trump administration inherited, revealing that the Consumer Price Index had shown an average inflation rate of 4.6 percent over the final three months of the Biden presidency — “way above target and an acceleration at the end of the Biden term.” Hassett cited Obama-era economic advisors Jason Furman and Larry Summers as having warned Biden his policies would cause massive inflation, noting that Furman had published a piece in Foreign Affairs “calling the Biden economic record a tragedy.” Hassett then outlined the Trump administration’s multi-pronged plan to end inflation: supply-side tax cuts, reduced government spending through DOGE and Congress, energy production, deregulation, and a specific plan for the avian flu crisis that Biden “didn’t really have."

"Way Worse Than We Thought”

Hassett opened by confronting the inflation data head-on. “What’s going on right now, as you know, is that there is an inflation problem that’s very large,” he said. “We saw the consumer price index come out, and we found out that the stagflation that was created by the policies of President Biden was way worse than we thought.”

He provided the specific number: “Over the last three months, across all goods including eggs, the average inflation rate was 4.6 percent — way above target and an acceleration at the end of the Biden term.”

The 4.6 percent figure was significant for two reasons. First, it was more than double the Federal Reserve’s 2 percent inflation target. Second, and more politically damaging, it represented an acceleration in the final months of Biden’s presidency — meaning inflation was getting worse, not better, when Biden left office. The Biden administration had spent its final year claiming that inflation was under control and declining; the CPI data told a different story.

Hassett’s use of the word “stagflation” was deliberate. Stagflation — the combination of stagnant economic growth and persistent inflation — is considered one of the worst possible economic conditions because the typical policy tools for fighting inflation (raising interest rates) make the stagnation worse, while tools for stimulating growth (cutting rates or increasing spending) make inflation worse. By applying the stagflation label to Biden’s economy, Hassett was characterizing the inherited situation as more severe than a simple inflation problem.

Biden’s Own Advisors Called It “a Tragedy”

In a devastating rhetorical move, Hassett cited Democrats’ own economic experts to validate his critique.

“Not just us — you could go look at Jason Furman, Larry Summers, economic advisors of President Biden kept saying, ‘Don’t do this, you’re going to cause massive inflation,’” Hassett said.

Jason Furman had served as chairman of the Council of Economic Advisers under Obama and was one of the most respected liberal economists in the country. Larry Summers had served as Treasury Secretary under Clinton and as director of the National Economic Council under Obama. Both had publicly warned the Biden administration that its spending levels would trigger significant inflation — and both had been proven right.

Hassett then dropped the most pointed citation: “In fact, Jason Furman has a very thought-provoking piece in Foreign Affairs right now calling the Biden economic record a tragedy.”

The word “tragedy” — published in Foreign Affairs, one of the most prestigious policy journals, by one of the Democratic Party’s most prominent economists — was more damaging than anything a Republican could say. When your own side’s economists describe your economic record as a tragedy in a premier journal, the debate is effectively over.

Hassett underscored the source: “And this is them, not us, right?”

The Multi-Pronged Plan

Hassett then outlined the administration’s approach to reversing the inflation trajectory. When an interviewer pressed on whether he was talking about fiscal spending, Hassett widened the frame.

“Where does inflation come from, right?” Hassett said, reframing the question as a diagnostic exercise. “And so what we’re doing now is we’ve got really a multi-prong plan to end inflation.”

He listed the components:

First, supply-side tax cuts. “We’re going to have a macroeconomic change that has supply-side tax cuts, so we have more supply,” Hassett said. The logic was that tax cuts that incentivized production and investment would increase the supply of goods and services, which would put downward pressure on prices. This was a fundamentally different approach from Biden’s demand-side spending, which Hassett argued had flooded the economy with money without increasing the supply of things to buy.

Second, reduced government spending. “We’re going to reduce government spending, both through what DOGE is doing and through congressional action,” Hassett said. Cutting government spending would reduce the amount of money flowing into the economy from federal programs, easing demand-side pressure on prices.

Third, energy production. “We’re also going to have a lot of energy production,” Hassett said. Energy prices are a major input cost for virtually every sector of the economy. Reducing energy costs through expanded domestic production would lower costs throughout the supply chain, from transportation to manufacturing to agriculture.

Fourth, deregulation. “A lot of deregulation,” Hassett added. Regulatory compliance costs are embedded in the price of virtually every good and service. Reducing the regulatory burden would lower production costs, which in turn would lower consumer prices.

Hassett summarized: “The macroeconomic forces that Jason Furman said were a tragedy are going to be reversed. That’s a good thing.”

The Avian Flu Plan Biden Didn’t Have

Hassett then demonstrated the administration’s item-by-item approach by addressing one of the most visible inflation flashpoints: egg prices.

“When needed, we’re going to focus on the individual thing-by-thing pieces,” Hassett said. “For example, you mentioned avian flu. President Biden didn’t really have a plan for avian flu.”

He described the work that was already underway. “Brooke Rollins and I have been working with all the best people in government, including academics around the country and around the world, to have a plan ready for the president next week on what we’re going to do with avian flu,” Hassett said. “In fact, I was editing the thing with them tomorrow.”

The avian influenza epidemic had devastated poultry flocks across the country, killing tens of millions of laying hens and driving egg prices to record levels. The absence of a Biden administration plan for avian flu — or at least the Trump team’s characterization of it as absent — positioned the new administration as more responsive to the specific economic pain points that voters were experiencing.

Agriculture Secretary Brooke Rollins had identified egg prices as the subject of her “very first briefing” after being confirmed, and the collaboration with Hassett’s NEC suggested the issue was being treated with genuine urgency across the administration’s economic team.

”Why Did They Do That?”

Hassett closed with a philosophical observation that framed the entire economic debate in terms of accountability.

“The question is like, why did we do this? Why did we do this? That’s what everybody’s talking about,” Hassett said. “But the thing that I always start with when I’m looking at what we’re doing or what the president wants us to do is: why did they do that? Why did they do that?”

He argued that the media had failed to ask the fundamental question: “There are too many times where it feels like nobody thought about that in the press. Why did Biden print so much money and cause so much inflation? Why did he do it?”

The question was rhetorical, but it served a purpose. By redirecting the conversation from “what is Trump doing about inflation?” to “why did Biden cause inflation in the first place?”, Hassett was ensuring that the origin story of the inflation crisis remained part of the public discussion. The risk for any new administration is that it inherits a problem and becomes identified with it. By relentlessly attributing the inflation to Biden’s specific policy choices — choices that even Democratic economists had opposed — Hassett was protecting the Trump administration from owning a crisis it did not create.

Key Takeaways

• NEC Director Kevin Hassett revealed that CPI data showed a 4.6% average inflation rate over Biden’s final three months, “way above target and an acceleration at the end of the Biden term.”
• Hassett cited Obama-era advisors Jason Furman and Larry Summers as having warned Biden his spending would cause massive inflation, noting Furman called Biden’s economic record “a tragedy” in Foreign Affairs.
• The Trump plan to end inflation includes supply-side tax cuts, spending cuts through DOGE and Congress, expanded energy production, and deregulation.
• Hassett said the administration was preparing a specific avian flu plan for the president, working with Agriculture Secretary Rollins, noting that “President Biden didn’t really have a plan for avian flu.”
• He posed the fundamental question the media had failed to ask: “Why did Biden print so much money and cause so much inflation? Why did he do it?”