NEC's Hassett on US Job Losses, Fed Independence, Iran, Energy Prices

Summary

White House NEC Director Kevin Hassett dissects the July jobs report, emphasizing a lower breakeven employment rate and solid private sector hiring. He outlines a strong US growth outlook driven by productivity gains, and argues that increased domestic energy production will push oil prices significantly lower once the Iran conflict ends. Hassett also discusses Federal Reserve independence, fiscal deficit reduction plans, and dismisses concerns about presidential interference in monetary policy.

• Hassett says the breakeven jobs number has fallen to about 40,000, making a 100,000 payroll gain very strong.
• He notes private sector job creation was near breakeven, while government employment fell by ~50,000 and hospitality was temporarily hurt by the end of the World Cup.
• He projects potential GDP growth of 3.0–3.5%, with productivity above 2.5% and capital spending adding at least 1%, while labor contribution slows.
• Hassett argues US energy policies have kept oil prices from spiking and that prices will drop quickly once the Iran situation is resolved.
• He states the administration's budget aims to bring the deficit to near zero over a decade through spending reductions and anti-fraud efforts.
• He asserts that President Trump respects Fed independence and only has normal economic conversations with Fed Chair Warsh, not rate directives.