How to Encourage Thoughtless Hostility | Joseph Margulies | Verdict

My last essay got a lot of attention, most of it positive. In it, I lamented the cultural obsession with demonizing binaries, but gave no examples. This essay fills the gap so we can see how casual and ubiquitous it has become.

When President-elect Donald Trump announced his intention to nominate Scott Bessent as Treasury Secretary, Senator Ron Wyden (D-OR), the chairman of the Senate Finance Committee, immediately released a statement on the committee’s website. The media dutifully picked up the first two sentences of this statement, which was widely reported in press coverage (e.g. New York Times, Politically, Chicago Tribune):

Donald Trump claims to be an economic populist, but it wouldn’t be a Trump Treasury without a wealthy political donor running the show. When it comes to the economy, the Trump administration is of, by and for the ultra-rich.

The Ministry of Finance oversees the banking system, manages federal finances, advises on national and international economic policy, and enforces financial and tax laws. It is an institution with enormous implications. But there is something to be learned from this statement, made by one of the most powerful figures in one of the most powerful institutions in the most powerful country in the world anything about Scott Bessent, the man who would run this institution, aside from apparently being a “rich political donor” to Donald Trump?

No, what you learn is that he is bad and we should reject him for no apparent reason other than his wealth and the money he gave to the president-elect.

During the campaign, Trump made deregulation, tariffs and deportations the centerpiece of his economic plan, arguing that these measures would boost growth and raise wages for working Americans. But none of them are without risk. Take tariffs into account. Economists agree that tariffs ultimately increase costs for consumers because sellers raise the prices of goods and services to cover the cost of tariffs. In this context, several scholars have examined the impact of Trump’s tariffs in the first term and found that the costs were “fully passed on to American buyers.”

In contrast, Bessent argued that “Trump’s first-ever tariffs did not increase the prices of the affected goods.” But pay attention to the wording: Bessent says the tariffs did not increase what consumers paid for the dutiable goods. Of course, companies can raise the prices of other goods and services to cover the tariff costs, and from a consumer perspective this has the same effect: they pay more.

The important question is therefore to what extent the tariff costs are ultimately passed on to the consumer, and not just whether the costs of a washing machine subject to the tariff remain the same. And on this issue, the research is surprisingly consistent: the costs have been passed on to consumers. (Bessent has said he believes new tariffs should be introduced gradually, which he said would give the market a chance to adjust. However, it is not clear how this will avoid pass-through costs.)

What about deportations? Trump argues that undocumented workers are driving down wages and displacing native-born workers, and that if we deport them, conditions for native-born workers would improve as unemployment falls and wages rise. However, there is very little reliable evidence to support this. While the exact impact depends on their scale, careful studies consistently show that mass deportations like those envisioned by the new president reduce GDP and increase unemployment.

And as much as some people hope it would be otherwise, the fact is that if we deport undocumented workers, U.S. citizens will be in no rush to fill their jobs. “Experiences with deportations so far show that it is not easy for employers to replace such workers. Instead, they respond by investing in less labor-intensive technologies to sustain their business, or they simply choose not to expand their operations. The net result is that fewer people are employed in key economic sectors such as services, agriculture and manufacturing.”

We could ask the same questions about all of Trump’s proposed economic policies. What are the risks of bank deregulation? How will the Trump Treasury ensure the independence of the Federal Reserve? What does Bessent think about the economic impact of climate change? Does artificial intelligence threaten jobs in some labor-intensive sectors, and if so, what will the Trump Treasury do about it? What are the current and emerging risks in cybersecurity? I could interview Bessent for hours and never ask the same question twice.

It is not my intention to repeat the election. Instead, I would simply like to note that Americans deserve to hear and need to understand how the new Treasury Secretary will answer these and other important questions. Does he believe – contrary to so many careful studies – that the ultimate cost of tariffs will not be passed on to consumers, and if so, why? And if that risk exists, how will the Trump Treasury address it? Does he believe that mass deportations – again contrary to popular belief – will not lead to a decline in GDP and an increase in unemployment? Does he believe, contrary to experience, that Americans will fill these positions? If so, why does he assume things will be different this time?

Importantly, none of these questions say anything about Mr. Bessent’s character or integrity, and we can ask them without creating the impression that he is somehow morally unfit for public service. On the contrary, I assume he is acting with the best of intentions and have no reason to believe otherwise.

Of course, if Senator Wyden were to read this essay, and I strongly suspect he won’t, he might point out that I, like the media, have only selectively quoted from his statement about Bessent. He might say that I’m the one who’s being unfair. But the whole statement doesn’t make it any better. Here it is:

Donald Trump claims to be an economic populist, but it wouldn’t be a Trump Treasury without a wealthy political donor running the show. When it comes to the economy, the Trump administration is of, by and for the super-rich. The proof lies in the fact that the first legislative priority for Trump and Republicans is to pass another round of tax breaks for the top while simultaneously increasing taxes on the products that American households buy and use every day. The next Treasury Secretary will be involved in this process, and I will be asking Mr. Bessent many questions about the value of a Trump policy that intentionally inflicts economic harm on families already struggling through the cost of living. I expect this nomination to go through the thorough and lengthy Finance Committee review process that applies to nominees from both parties. The American people should view any attempt to bypass this process as an attempt to hide important information about Trump’s candidates and policy plans in the shadows.

Yes, it’s true, the rest of the statement references Trump’s proposed tariffs, which Wyden correctly calls a tax increase. But it’s very hard to read that statement and get the idea that Wyden wants to have a thoughtful discussion about economic policy or educate the American public. What he wants is to portray the Trump Treasury as part of a deliberate plan to “inflict economic harm on families already suffering from the cost of living.” In short, he wants to encourage thoughtless political hostility. It’s annoying.

More importantly, Wyden knows full well that the press won’t use his entire statement; He knows that they will select the excerpt that is best copied, that is, the most inflammatory and caustic, and therefore the part that best illustrates his expected role in the ritualized drama of contemporary political life. It is a consideration: Wyden promises to say something interesting in return for the media’s promise to quote him. And that’s exactly what happened. I can’t find a single media outlet that quoted more than the first two sentences, just as Wyden expected.

I don’t think I should end this essay without the obligatory assurance that I have nothing against Senator Wyden. On the contrary, I am sure that I agree with him on most of the substantive issues. As with Bessent, I assume Wyden is acting with the best of intentions and has no reason to believe otherwise. We can also imagine that Wyden is correct in saying that he is doing nothing more than what is normal for those in his position and that that is just how the sausage is made in Washington. He might even say that this is what his voters want. They want a “fighter,” and he believes that’s what it means to “fight” in today’s America.

All of this may be true, and that is the problem.

As always, and in the spirit of thoughtful conversation, if you have any reactions to this essay, please feel free to share them with me at [email protected].