Amit Seru, a Senior Fellow at the Hoover Institution and professor at the Stanford Graduate School of Business, issued a stark assessment of the U.S. economy on April 21, 2026, arguing that persistent policy uncertainty is undermining the nation's economic momentum. In an analysis titled The Great Hesitation, originally detailed in The New York Times and highlighted by the Hoover Institution, Seru stated that while the Trump administration has pursued pro-business goals such as corporate tax cuts and deregulation, the benefits of these policies are being negated by frequent and unpredictable policy shifts.
Seru highlighted that the Baker, Bloom and Davis Economic Policy Uncertainty Index, a widely recognized metric for measuring policy-related volatility, has surged to levels not seen since the 2008 financial crisis and the onset of the COVID-19 pandemic. This heightened uncertainty has created what Seru calls The Great Hesitation, a phenomenon where businesses across the country are delaying or canceling long-term investments and hiring initiatives because they cannot reliably forecast the regulatory or trade environment.
The report identified several specific drivers of this economic instability. Chief among them is the ongoing conflict in Iran, which has introduced significant volatility into global oil prices and disrupted international markets. Additionally, Seru pointed to the administration’s aggressive trade stance. Although steep tariffs were imposed on nearly all U.S. trading partners approximately one year ago, the administration has frequently shifted or rescheduled these duties in response to lobbying, market fluctuations, and judicial challenges. Seru noted that a recent Supreme Court ruling declaring parts of the sweeping tariff plan illegal has further complicated the landscape for American firms.
Beyond trade and geopolitics, Seru cited administrative and regulatory churn as a primary concern. He noted that regulatory agencies have abruptly altered priorities or halted ongoing cases, creating a climate of constant chaos. Seru also pointed to public friction regarding the leadership and future of the Federal Reserve as a factor that has eroded confidence. According to Seru, while modern firms are equipped to adapt to change, they are fundamentally unable to function effectively under conditions of perpetual policy flux.
The consequences of this uncertainty are particularly evident in the innovation and labor sectors. Seru argued that the current environment leads to diminished productivity growth and fewer job opportunities for the current generation of workers. To mitigate these effects, Seru advocated for policy restraint from both current administration officials and those seeking to reverse existing measures. He concluded that restoring economic dynamism requires a commitment to stability to prevent further destabilizing countershifts in the American capitalist system.