The Brian Lehrer Show The Fed's Interest Rate Decision, a Tariff Deadline and a New Jobs Report
Aug 1, 2025
John Cassidy, a staff writer at The New Yorker and author, dives into the current economic landscape shaped by Trump's upcoming tariffs and the Federal Reserve's interest rate decisions. He discusses the latest jobs report, revealing a decline in job growth and rising unemployment, while raising concerns about stagflation. Cassidy highlights the impact of tariffs on American businesses, including a family toy maker in Illinois, and critiques the government's shift away from open trade, emphasizing broader implications for global relations and manufacturing.
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Jobs Report Reveals Economic Slowdown
- The July jobs report shows a significant economic slowdown with far less hiring than expected and downward revisions for previous months.
- Manufacturing jobs have declined despite tariffs aimed at boosting that sector, indicating a negative impact from tariff policy.
Fed Awaits Data Before Rate Cuts
- The Fed held interest rates steady to wait for clearer data on tariff impacts, despite some calling for rate cuts.
- The jobs report suggests economic growth is slowing, making a rate cut likely at the next meeting to support growth.
Tariffs Inflation Raises Stagflation Risk
- Tariffs raise input costs, increasing inflation while unemployment rises, risking stagflation.
- This creates a difficult dilemma for the Fed between controlling inflation and supporting job growth.
