US Treasury Secretary Says White House Trying to Stave Off Financial Crisis

Treasury Secretary Scott Bessent said on Sunday that policies initiated by the Trump administration are designed to head off a financial crisis that may be the result of major government spending over the past several years but cautioned there are “no guarantees” that no recession will occur.

There have been concerns that recent policies, such as tariffs, could lead to a financial crisis or a recession. When asked by an NBC News reporter about a recession occurring, Bessent said that the Trump administration is working to prevent a more serious crisis and that there is no reason for a recession to occur.

“There’s no reason that it has to. But I can tell you that if we’d kept on this track, what I could guarantee is we would have had a financial crisis. I’ve studied it. I’ve taught it. And if we had kept up at these spending levels, that everything was unsustainable,” Bessent said. “We are resetting and we are putting things on a sustainable path.”

President Donald Trump has said he wants the government to reduce spending and eliminate waste and fraud. Early on in his second term, he signed an order to create the Department of Government Efficiency (DOGE), led by presidential adviser Elon Musk, to reduce spending on certain programs that are deemed wasteful or fraudulent.

Meanwhile, the Trump administration has issued tariffs on aluminum, steel, lumber, and a range of goods and has levied 25 percent duties on all products coming from Mexico and Canada over illegal immigration and drug trafficking. Trump also placed additional tariffs on products coming from China over what the administration says is the Chinese regime’s inability to deal with the making of fentanyl precursor chemicals that make it into the United States.

In the past several weeks, U.S. stock indexes such as the Dow Jones Industrial Average and Nasdaq have seen decreases. In the past 30 days, the Dow has dropped by about 6.4 percent, down by more than 2,800 points, while the Nasdaq has dropped by more than 10 percent, down by more than 2,000 points.

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When asked by NBC about the stock market’s drop and whether he’s worried, Bessent described what’s happening with the markets as “corrections,” which are “healthy.”

“I’ve been in the investment business for 35 years. And I can tell you that corrections are healthy. They’re normal,” he said. “What’s not healthy is straight-up ... euphoric markets. That’s how you get a financial crisis. It would have been healthier if someone had put the brakes on in ‘06–’07.

“We wouldn’t have had the problems in ‘08. So I’m not worried about the markets. Over the long term, if we put good tax policy in place, deregulation, and energy security, the markets will do great.”

Bessent pointed to “large government deficits” that have been run by previous administrations, adding that the administration is bringing down spending “in a responsible way.”

“We are going to have a transition. And we are not going to have a crisis,” he said.

Responding to a question about whether a recession may occur, Bessent said that “there are no guarantees” and pointed to the emergence of COVID-19 in 2020.

“Who would have predicted COVID, right? So I can predict that we are putting in robust policies that will be durable. And could there be an adjustment? Because I tell you, this massive government spending that we'd had, that if that had kept going, we have to wean our country off of that,” he said. “And on the other side, we are going to invigorate the private sector.”