In confidential discussions weeks ago, senior advisers close to President Trump cautioned that certain tariff proposals could lead to catastrophic outcomes for global financial markets and trigger a downturn in the U.S. economy.
The White House has stressed that administration officials are aligned on the tariff initiative announced on April 2, which the White House called “Liberation Day”.
However, internal disputes regarding that policy arose long before this announcement, with leaders predicting significant economic instability, multiple sources familiar with the discussions informed CBS News.
A notable dispute occurred between Treasury Secretary Scott Bessent and White House trade adviser Peter Navarro in chief of staff Susie Wiles’ office in late March, just days before the announcement of Mr. Trump’s “reciprocal” tariffs.
The following account is based on multiple sources acquainted with the meeting details. Navarro advocated for 25% across-the-board tariffs on all $3 trillion of imported goods. Bessent, a former Wall Street investor, warned of potential market upheaval and presented various scenarios.
The conversation escalated.
Navarro retorted: “You’re repeating the mistakes from the first term. Don’t do this. Don’t be him.”
Advisers present later conveyed that this was interpreted as a warning against mimicking then-Treasury Secretary Steven Mnuchin or former economic adviser Gary Cohn, both ex-Goldman Sachs executives from the first Trump administration who had resisted hardline tariff proposals.
Representatives from the Treasury Department declined to comment on the disagreement.
Navarro told CBS News: “This is false news from malicious anonymous sources. Scottie and I do not argue. We work through our thoughts together.”
In other internal discussions prior to the Rose Garden announcement, Commerce Secretary Howard Lutnick predicted that certain tariffs could precipitate global disaster.
Bessent consistently advocated for a structured approach, favoring more targeted tariffs compared to what Navarro proposed.
Elon Musk, the administration’s chief government efficiency adviser, was not involved in critical tariff decision meetings. He was cautious about expressing his strong disapproval of certain aspects of the tariff policy, except in very small circles, though some of his criticism towards Navarro eventually surfaced on social media. Musk also publicly championed zero tariffs between the United States and the European Union.
Navarro insisted that negotiations should be off the table — the tariffs should remain intact to generate revenue and push manufacturers toward domestic production.
However, in the aftermath of the “Liberation Day” announcement, financial markets struggled, confirming some of Trump’s advisers’ earlier warnings. Trillions of dollars were wiped off major stock indexes, and the bond market sent distressing signals. Wall Street firms, including Goldman Sachs, foresaw increased recession risks, while several top CEOs publicly voiced their apprehensions.
During an interview on the morning of April 9, JPMorgan Chase CEO Jamie Dimon stated to Maria Bartiromo that a recession was “a probable outcome.”
Delta CEO Ed Bastian remarked on CNBC that the turmoil was “self-inflicted,” and announced the company would suspend its full-year guidance due to “the uncharted and unprecedented uncertainty.”
That same morning, Mr. Trump sought to reassure investors and executives, tweeting: “BE COOL! Everything is going to work out well.”
By the afternoon, in response to input from Bessent and Lutnick, Mr. Trump decided to relieve some pressure and paused some tariffs for 90 days.
“I felt people were overreacting a bit,” Mr. Trump remarked. “They were getting a bit yappy — you know, they were getting a little bit yappy, a little bit fearful.”
