Paul Krugman

This is a sales tax.

A tariff is, in the end, a sales tax.

There's a lot of moving parts in the way that works out, but it's in the end.

The Trump tariffs are about, in total, the tariff increase is around 0.9% of GDP.

Yeah, no, that's right.

It's a little bit.

And if you actually kind of work it through.

But the I am because it's a tax hike.

The tariffs are slightly contractionary.

maybe more than slightly.

That's one of those things where you have to ask what else is going on.

But how does this affect the Fed?

I mean, if the tariffs weren't there, the Fed would probably have lowered rates already and so on.

But it's certainly, it is a

A significant increase in the cost of living, not a gigantic increase in the cost of living, but everybody's cost of living is somewhat higher because of these tariffs.

And, you know, that will go away.

But these other tariffs would also be a tax on on the American people.

And so, yeah.

Well, Paul, we only have about a minute left, but you said that will go away in reference to the cost of living.

And I want to ask you about your confidence there, because when a company raises prices, they tend to be sticky.