The following is the transcript of the interview with Gary Cohn, vice president of IBM and former director of the National Economic Council of the United States, broadcast on “Face the Nation with Margaret Brennan” on February 1, 2026.
MARGARET BRENNAN: Welcome back to Face the Nation. For an update on the economy, we’re joined by Gary Cohn, who was President Trump’s top economic advisor during his first term. He is now vice president of IBM. Glad to see you back here.
GARY COHN, VICE PRESIDENT of IBM: Thank you for inviting me.
MARGARET BRENNAN: So the president published this op-ed in the Wall Street Journal, saying that all of the economic success we’re seeing right now is because of his tariff policies. The legality of some of these tariffs is currently being debated before the Supreme Court. How factual do you rate his argument?
COHN: Well, I think we need to take a step back. The economy is currently quite strong in terms of revenue growth. So if you look at GDP, gross domestic product, which is the overall output of the U.S. economy, we’re currently trending at about 5%, which is a very high growth rate in the United States, well above the baseline that we’ve had over the last decade. So if you look at that one number, and it’s a good number, things are going well. The inflation rate has fallen to the high level of 2%. It’s still higher than we would like. And the unemployment rate is increasing, but it’s still at a reasonable level around 4, 4.5%. So overall, the economy is pretty strong right now. That said, we have an interesting economy right now. We have this massive wealth effect at the top. And we have hard-working Americans who are having a hard time paying their bills, and who are suffering in this economy. And I think the White House has recognized that they are suffering. I think part of the reason the president wrote that opinion piece was to try to make his voice heard in front of people who are struggling to pay their bills and keep up with their expenses. The White House is going on the offensive. The president will spend time on the road talking about affordability. Affordability will be the problem.
MARGARET BRENNAN: He says it’s a hoax.
COHN: Well, I think affordability will be the issue between now and the midterm elections.
MARGARET BRENNAN: That’s right. And we know the chief of staff has said she wants the president to talk about the economy. But you just mentioned how consumers feel. The White House says people will feel better after tax season. You wrote this original tax law that was then renewed and expanded by Congress. But you see companies like Amazon announcing they are cutting 16,000 jobs. MasterCard is cutting 4% of its 35,000 workforce. UPS, 30,000 jobs cut. Dow Jones, 4,500. Home Depot, 800. If everything is moving in a positive direction, what’s going on there?
COHN: So we saw over 60,000 additional corporate layoffs last week during earnings season. This is usually when companies talk about expense management. Businesses today have two fundamental things to do. First, businesses hoarded labor during and after COVID. When we worked from home and people were remote, productivity decreased and businesses worried about not being able to complete their workload. So most companies end up hiring additional staff or not laying off anyone. The numbers have therefore exploded. And I think we’re now in the part of the cycle where corporate America is very comfortable replacing people. They are very comfortable when it comes to hiring people. They therefore reduce their numbers from hoarding to a more naturalized level. And I think a lot of the numbers that were announced this week were companies that were scaling themselves. Additionally, we’ve seen input costs for businesses rise quite dramatically, whether it’s the cost of labor, the price of raw materials or tariffs, as we agree. Someone has to pay the fares. As businesses try to balance their equation…
MARGARET BRENNAN: –The president says there are no costs that could hurt a business.
COHN: But he also says there’s over $200 billion in an account of money that they’ve collected. The money is therefore paid by someone. It is therefore the companies who pay. They’re trying to figure out how to deal with rising input costs, falling tariffs, rising labor costs, and don’t really have the ability to raise prices for the consumer, because we’ve seen how difficult it is for a lot of Americans to afford certain things today. Companies therefore find themselves on the fine line between absorbing input costs and not being able to raise prices.
MARGARET BRENNAN: So the White House, as you said, is aware that it has a problem, even if it doesn’t want to explicitly say that it has a political problem because of this low-end consumer. But when you look at it, one of the ideas the president has floated is to cap credit card rates at 10% for one year and get Congress to enforce it one way or another. He signed an executive order aimed at limiting the purchase of single-family homes by institutional investors. And then he floated this idea of $2,000 checks, which may or may not require Congress. What do you think of these consumer-focused parts of the plan? Are they viable?
COHN: Look, I think it’s admirable that they understand that people today are trapped by money. They find themselves with insufficient disposable income. So I think the White House is launching ideas that will put more disposable income into the hands of consumers…
MARGARET BRENNAN: –These are not ideas that you would have approved of when you were in this advisory role…
COHN: – Unfortunately, these ideas probably don’t solve the problem. In fact, credit card rates probably have the opposite effect. So credit card companies charge people a risk-adjusted rate to lend them money. Obviously, the worst credits, the people who have the highest probability of default pay the highest rates. If you cap the rates that can be charged, what do companies do? In fact, they stop lending to the riskiest part of the population. Thus, their consumers will lose purchasing power, but will not gain any. You know, when it comes to housing, the one thing I remind people is that the institutional accumulation of housing happened after the financial crisis of 2008. When we had a massive glut of houses in the United States, prices were collapsing. The financial markets therefore intervened and supported the real estate market. And we cannot forget the importance of these financial players in times of stress.
MARGARET BRENNAN: Well, we should also say that you worked for Goldman Sachs and were president of Goldman Sachs for a very long time, including during this financial crisis. But let’s not dwell on that, but let’s talk about someone you knew at that time. This was Kevin Warsh, who was governor of the Fed and is now President Trump’s choice to be the next chairman of the Federal Reserve. He calls for all kinds of Fed reforms. What do you expect from him in power?
COHN: So, look, I think we’re very lucky to have Kevin as our candidate. Kevin has a unique background as president. As you said, he was previously on the Fed board. He was there during the financial crisis of 2008. He played a decisive role in this crisis. What I mean by that is when the banks were going through stress, we saw a lot of bank mergers, a lot of assets moving around the system, Kevin was the point person at the Fed. He participated in each of these discussions. And I sincerely believe that without Kevin’s expertise and without his presence, we would not have come out of the 2008 crisis as well. He is therefore very highly qualified. He will return the Fed to its traditional norms. You know, I think Kevin is going to stay out of a lot of non-financial issues. He’s obviously going to be involved in setting interest rate policy. There is currently pressure for interest rates to fall. I think he’ll probably make one or two cuts this year. Kevin also believes that the Fed should not have a large balance sheet. You know, the Fed came in and bought a huge amount of securities…
MARGARET BRENNAN: –Quantitative easing (inaudible)
COHN: I think Kevin is going to reverse that trend. I think he will seek to have the Fed reduce its balance sheet. And on the regulatory side, I think Kevin is a traditionalist who believes that we need strong regulation in the United States, but it has to be regulation that works and allows the market to grow and allows the consumer to have access to capital. So I think he’s actually the right choice at this time. And on Friday, when his appointment was announced, the markets spoke.
MARGARET BRENNAN: Yeah.
COHN: And I think you have to look at what the markets are telling you because those are real-time feedback indicators.
MARGARET BRENNAN: That’s right.
COHN: So we saw the dollar strengthen by about 1%. We saw silver fall 25%. We saw gold fall 10%…
MARGARET BRENNAN: –The president also spoke at a dinner last night and said he was going to sue Warsh if he didn’t lower interest rates. Do you take this as a joke?
COHN: Yes, I take that as a joke. Look, I think the president completely understands the independence of the Fed. Kevin is a strong advocate for the independence of the Fed.
MARGARET BRENNAN: Well, he has a confirmation process to go through, and we’ll see if Thom Tillis’s demand for a Justice Department investigation into the current Fed chairman prevents him from actually pushing it through. But we will follow this. Gary Cohn, it’s always a pleasure to have you here.
COHN: Thanks for inviting me.
MARGARET BRENNAN: We’ll be right back.
