Dr. Phelan Faces Tough Questions on Inflation, Wages and Housing in Senate Hearing

Dr. Phelan, President Trump’s nominee to chair the Council of Economic Advisors (CEA), appeared before the Senate committee and described the council’s role as providing "sober facts and analysis," not political messaging. He said, if confirmed, his focus would include financial stability and generational economic issues.

Ranking Member Senator Warren opened the hearing with a sharp critique of the administration’s economic record and repeatedly pressed Phelan for simple factual answers about inflation and wages. When Warren asked whether headline inflation was higher now than in February 2025, Phelan said he did not have the January 20, 2025 figure immediately available but later stated the most recent year‑over‑year headline inflation figure as "4.2%." Warren challenged the implication that families were getting ahead; she said many Americans are "falling behind" and that the public needs objective advice rather than a presidential mouthpiece.

Phelan responded that economists tend to emphasize core inflation because food and energy are volatile but reiterated his view that "real wages are higher now." When asked whether inflation was higher than annual wage growth, Phelan declined to give an on‑the‑spot wage‑growth percentage, saying he did not have the number in front of him; Warren cited a 3.4% annual wage growth figure and pressed the comparison.

Senators also questioned Phelan about the role of regulation and NEPA reform in housing production. Phelan cited research and a Council study estimating that unnecessary regulation can materially raise housing costs—he repeated a figure discussed in the hearing that regulation can add as much as "$100,000 per house" in some studies—and said the CEA would quantify the economic effects of proposals if asked. On whether he would recommend the president sign a recently passed bipartisan housing bill, Phelan said the chair would not "recommend signing this or not" as a political question but would provide an analysis of the bill’s economic advantages or disadvantages if asked.

On trade and tariffs, Phelan told senators that tariffs tend to raise prices for some tariff‑affected goods but that the evidence on tariffs driving general inflation is mixed and remains the subject of active academic debate. He said the CEA would work with its economists to study supply chains, minerals and pharmaceutical vulnerabilities related to strategic competition with China.

The committee closed the session by setting deadlines for follow‑up: senators must submit additional written questions by noon Wednesday, July 1, and witnesses must answer by 5 p.m. Wednesday, July 8. The hearing was adjourned without a committee vote on the nominees.