President Donald Trump turned a Tuesday appearance at the Detroit Economic Club into a two-front economic offensive, ramping up his critique of Federal Reserve policy while defending tariffs as the catalyst behind a manufacturing renaissance in Michigan and across the industrial Midwest.
Trump painted a picture of an economy firing on all cylinders, driven by deregulation, aggressive trade policy and energy expansion. But he made clear that he believes the Fed is standing in the way of even stronger growth.
The Fed's Rate Policy Under Fire
"In the old days, when you had good numbers, interest rates would go down and the market would go through the roof," Trump said. "Now you announce great numbers and they raise rates to try and kill the rally."
It's a familiar gripe, but the timing matters. Trump's argument is that robust economic performance should lead to lower borrowing costs, not higher ones. In his view, falling rates would amplify U.S. economic strength rather than destabilize it.
The remarks pile more political heat on the central bank as markets continue debating when and how aggressively the Fed might cut rates in 2026. Trump stopped short of naming Fed officials directly, but the subtext was hard to miss. He wants a central bank leadership more aligned with his pro-growth agenda, and speculation is already building over who might replace Fed Chair Jerome Powell when his term expires in May.
The backdrop makes things even messier. Just days earlier, the Department of Justice launched a criminal probe into Powell over the central bank's building renovation costs, raising fresh concerns about political interference in monetary policy.
Tariffs as Economic Engine
Beyond the Fed, Trump spent considerable time defending his tariff strategy as the driving force behind a shift in trade dynamics and domestic manufacturing investment. He claimed the U.S. trade deficit has narrowed sharply, crediting tariff revenue and behavioral changes among trading partners following his election.
"One of the biggest reasons for this unbelievable success has been our historic use of tariffs," Trump said, highlighting they have slashed the U.S. trade deficit and redirected global capital back into American factories.
Trump dismissed the standard economic criticism that tariffs function as a tax on American consumers, insisting that foreign governments and intermediaries absorb the costs instead.
"Evidence shows overwhelmingly that the tariffs are not paid by American consumers," Trump said.
Michigan, in Trump's telling, is exhibit A. He reiterated his commitment to a 25% tariff on foreign-made automobiles, framing it as direct protection for U.S. auto workers.
"Tariffs are making money for Michigan," he said.
He pointed to concrete examples. Ford Motor Company (F), according to Trump, has resumed round-the-clock production at its Michigan complex and committed billions in new investment across Midwestern plants. He also highlighted General Motors Co. (GM) plans to shift production of the Chevrolet Blazer and Equinox from Mexico back to the United States, framing the move as proof that tariffs are changing corporate calculus.
Trump claimed U.S. auto factories have attracted more than $70 billion in new investment since his return to office, reversing years of offshoring and plant closures that hit Michigan and the broader industrial Midwest particularly hard.
"If they want to come in and build plants here and hire American workers, that's great," Trump said. "That's exactly what these tariffs are designed to do."