Treasury Secretary Scott Bessent on Thursday offered a full-throated defense of the White House’s position on tariffs, insisting that trade policy has to be about more than just getting low-priced items from other countries.

“Access to cheap goods is not the essence of the American dream,” Bessent said during a speech to the Economic Club of New York. “The American Dream is rooted in the concept that any citizen can achieve prosperity, upward mobility, and economic security. For too long, the designers of multilateral trade deals have lost sight of this.”

The remarks came with markets on edge over how far President Donald Trump will go in an effort to attain his goals on global commerce. Stocks fell sharply Thursday despite news about some movement from the administration on Mexican imports.

In a speech delivered to a crowd of leading economists, Bessent indicated that Trump is willing to take strong measures to achieve his trade goals.

“To the extent that another country’s practices harm our own economy and people, the United States will respond. This is the America First Trade Policy,” he said.

Earlier in the day, Commerce Department data underscored how far the U.S. has fallen behind its global trading partners. The imbalance swelled to a record $131.4 billion in January, a 34% increase from the prior month and nearly double from a year ago.

“This system is not sustainable,” Bessent said.

Economists and market participants worry that the Trump tariffs will raise prices and slow growth. However, White House officials point out that tariffs did little to stoke inflation during Trump’s first term, touting growth potential from reshoring as companies look to avoid paying the duties.

“Across a continuum, I’m not worried about inflation,” Bessent said. He added that Trump considers tariffs to have three benefits: as a revenue source with the U.S. running massive fiscal deficits, as a way to protect industries and workers from unfair practices around the world, and as “the third leg to the stool” as Trump “uses it for negotiating.”

Thursday’s talk was hosted by Larry Kudlow, the head of the National Economic Council during Trump’s first term.

In addition to discussing tariffs, the two chatted about deregulation as well as the onerous debt and deficit burden the government is facing. The budget is already $840 billion in the hole through just the first four months of fiscal 2025 as the deficit runs above 6% as a share of gross domestic product, a level virtually unheard of in a peacetime, expansionary economy.

“This is the last chance bar and grill to get this done,” Bessent said of imposing fiscal discipline. “Everyone knows what they should do. It’s, do they have the willpower to do it?”

Bessent also advocated a deep examination of bank regulations, particularly for smaller institutions, which he said are burdened with rules that don’t help safety.

As Bessent spoke, stocks added to losses in what has been a tough week for Wall Street.

“Wall Street’s done great, Wall Street can continue doing well. But this administration is about Main Street,” he said.