BOSTON — Federal Reserve Gov. Stephen Miran said Monday that the Trump administration’s tariffs have proved “quite muted” for the U.S. economy and are being paid largely by foreign firms, not American households, as the Supreme Court weighs whether the president had the authority to impose the import taxes, Feb. 9, 2026.
Household-budget estimates point the other way. The Yale Budget Lab, which tracks the 2025-26 rollout of tariffs and foreign retaliation, estimates the median cost at about $1,400 per household each year, along with a short-run rise in consumer prices.
Tariffs at the Supreme Court: emergency powers on trial
The legal fight centers on whether the International Emergency Economic Powers Act — the 1977 law best known for sanctions — can be used to impose broad tariffs. Lower courts rejected that view, and the Supreme Court expedited the case and heard arguments in late 2025, according to a Congressional Research Service summary of the litigation.
With a decision still pending, U.S. Trade Representative Jamieson Greer said the justices understand the “enormous” stakes, pointing to large revenues collected under the tariffs and the role the duties have played in the administration’s trade strategy, Reuters reported.
If the court strikes the tariffs, importers and businesses that paid duties could push for refunds, and the White House could face pressure to rebuild its trade approach using narrower statutory tools — or go back to Congress for new authority.
Who pays tariffs? Miran challenges the pass-through story
In his Boston appearance at Boston University’s Questrom School of Business, Miran argued that the standard story — that tariffs show up in higher prices for U.S. buyers — overstates how much pain lands at home. “I think the world has been coming in my direction,” he said, adding that many experts now see the tariff impact as “quite muted,” according to Reuters.
Miran’s core point: some datasets label the payer as a U.S. entity even when that entity is a U.S. subsidiary of a foreign company. In that framing, part of what looks like a domestic burden may reflect a foreign parent absorbing costs via lower margins. He also argued tariff revenue could help narrow the primary deficit, a claim that aligns with a broader White House push to frame tariffs as both leverage and financing.
Yale pegs tariffs’ median hit at about $1,400
The Yale Budget Lab’s latest “State of U.S. Tariffs” update estimates the median annual household cost at about $1,400 and describes tariffs as regressive in the short run, falling harder on lower-income households as a share of income. It also estimates a short-run consumer price increase of roughly 1.3% under the 2025-26 tariff mix and models weaker growth and a higher unemployment rate than would otherwise be expected. (Full methodology and figures are in the Yale Budget Lab report.)
Another recent data point cuts against Miran’s confidence. A January analysis from the Kiel Institute for the World Economy said U.S. importers and consumers bore about 96% of the tariff burden in shipment-level data through late 2025, with foreign exporters absorbing only a small share.
Why the tariffs argument keeps returning
The dispute over who “pays” tariffs is not new. During the first Trump-era U.S.-China trade war, economists at the New York Fed estimated that higher tariffs were raising costs for U.S. households — an argument they laid out in a 2019 Liberty Street Economics post titled “New China Tariffs Increase Costs to U.S. Households.”
That same year, a Reuters explainer walked through the mechanics: tariffs are collected from importers at the border and can be passed along through supply chains in the form of higher prices, the outlet reported in 2019.
And as tariff proposals returned to the center of U.S. politics, economists continued to warn about household effects. A 2024 Peterson Institute policy brief argued that broad tariff hikes would likely reduce real incomes for many working Americans and could invite retaliation that blunts any hoped-for gains. (See the Peterson Institute’s May 2024 brief.)
For now, Miran’s message is essentially a bet that today’s tariff regime is different — and that the data, properly read, support the White House’s long-running claim that foreigners pay. The coming Supreme Court ruling will not settle the economics question, but it could determine whether the administration can keep using emergency powers as the backbone for its tariff strategy.
