Treasury Secretary Scott Bessent urged skittish global business leaders on Monday to ignore President Trump’s economic naysayers and ramp up investment in the United States, defending an economic agenda that economists warn will slow economic growth and exacerbate inflation.
Speaking to executives, entrepreneurs and policymakers, Mr. Bessent argued that the Trump administration’s economic plans go beyond trade policy and will pay off in the long run. He urged them to also focus on Mr. Trump’s plans to cut taxes and regulation, which he said would spur job creation and output.
“Tariffs are engineered to encourage companies like yours to invest directly in the United States,” Mr. Bessent said in remarks at the Milken Institute Global Conference in Los Angeles. “You’ll be glad you did — not only because we have the most productive work force in the world. But because we will soon have the most favorable tax and regulatory environment as well.”
His comments came just hours after Mr. Trump ordered up new tariffs on foreign film producers, a decision that left many in Hollywood puzzled about how such a tax would work.
The Treasury secretary has been working to ease concerns among investors that Mr. Trump’s trade plans will destabilize the global economy. Last month the president levied tariffs on countries around the world and escalated a trade fight with China, which sent financial markets plunging.
Since then, Mr. Bessent has been racing to negotiate trade deals with dozens of countries. He has also signaled that the China tariffs are not sustainable, offering hope that Mr. Trump would soon begin negotiations to lower them.
“Our goal with trade policy is to level the playing field for our great American workers and companies,” Mr. Bessent said.
Business leaders continue to be on edge about the Trump administration’s haphazard approach to setting trade policy.
Mr. Trump on Sunday night posted on Truth Social that he was directing his government agencies “to immediately begin the process of instituting a 100% Tariff on any and all Movies coming into our Country that are produced in Foreign Lands.” However, on Monday a White House spokesman said that “no final decisions on foreign film tariffs have been made” and that the administration was still considering its options.
Despite Mr. Bessent’s calls for investors to take a longer-term view on the U.S. economy, executives at the Milken Institute gathering made clear that the tariffs were taking a real toll.
“What we’re hearing from clients is that they’re prepping for headwinds,” said Jan Fraser, the chief executive of Citigroup, who noted that some businesses were pulling spending forward, some were delaying investment and all were being more cautious while they waited to see how the Trump administration proceeded with its tariff plans.
Harvey Schwartz, the chief executive of the Carlyle Group, said that a trade war between the United States and China was problematic for the world economy and that the tariffs have sapped some of the enthusiasm about Mr. Trump’s economic agenda that was prevalent when he took office in January.
“I think we came into the year and there was this extraordinarily high expectation and momentum and everything was sort of pro-growth,” Mr. Schwartz said in a panel discussion following Mr. Bessent’s remarks. “And I think with the tariff policy, people were just left a bit confused and uncertain, because it felt like such a shift dramatically in policy.”
He added: “This is a policy initiative that we’ve never seen.”
Mr. Bessent has attempted to shift the policy discussion to tax cuts, which he has predicted Congress could pass by early July.
The Trump administration is working closely with congressional Republicans on tax legislation that would extend the 2017 tax cuts and offer new tax breaks for overtime pay, tips and Social Security benefits. Mr. Bessent said that the bill would include tax credits and deductions for research and innovation to stimulate investment in high-tech operations and tax incentives for purchasing equipment and building factories.
Mr. Bessent made the case on Monday that investors need to consider the broader agenda when thinking about where to park their money.
Describing Mr. Trump’s policies as “mutually reinforcing,” Mr. Bessent said, “Acting in concert, they push toward the same goal — to solidify our position as the home of global capital.”
Investors have grown increasingly wary of Mr. Trump’s policies in recent months, with stocks, bonds and the dollar all showing signs of weakness as fund managers fret over the uncertainty surrounding Mr. Trump’s policymaking approach.
The International Monetary Fund projected last month that global output would slow to 2.8 percent this year from 3.3 percent in 2024 and sharply downgraded its outlook for the U.S. economy.
“Clearly we are experiencing significant turbulence in global trade,” Kristalina Georgieva, the managing director of the I.M.F., said at the Milken conference on Monday. “We are now going from a predictable trade regime that we had before to what eventually is going to be a new equilibrium.
She added: “What the world is paying for that shift, from one equilibrium to something new, is not trivial.”
Despite those concerns, Mr. Bessent on Monday said Mr. Trump would prove “critics in establishment circles” wrong.
“We have the world’s reserve currency, the deepest and most liquid markets, and the strongest property rights,” Mr. Bessent said. “For these reasons, the United States is the premier destination for international capital.”
