Trump Econ 101
Terry H. Schwadron
April 19, 2025
Insistent on finding positive news amid the economic turmoil fomented by his ever-changing tariffs policies, Donald Trump said in interviews and social media posts this week that “the cost of almost all products” in the U.S. is “going down, including gasoline, groceries, and just about everything else.”
Um, not exactly true.
Yes, gasoline prices are down an average 8 cents per gallon over last week, but still above prices from, say, a month or year ago. The reason: tariffs have roiled international markets, and oil producers are worried about replacing lost sales, not because of Trump intervention. Wholesale egg prices are down month-to-month in similar fashion, but still higher than six months or a year ago — because Trump spent a billion dollars to import eggs from overseas not because of presidential jawboning with producers dealing with bird flu.
General supermarket prices are up, a direct reflection of the cost of tariffs on coffee, bananas, avocados and produce. Trump may have information not yet shared with the public, but the latest data from the U.S. Bureau of Labor Statistics (BLS) provides is more complex than Trump wants reflected. Even with reciprocal tariffs by nation largely suspended for three months — except for China — blanket tariffs and those on autos and on specific items spell out higher U.S. consumer prices on clothing, construction, and most other goods dependent on global supply chains or manufacture.
In response, we’re hearing businesses react with layoffs rather than new investment and threats of “stagflation” with higher prices and higher unemployment. Add to that dumping of tens of thousands of federal employees and the services they provide.
Trump blurted out positive news to criticize Fed chair Jerome Powell for what sounded like perfectly reasonable analysis that said it is hard for the Fed to make any move on monetary policy while tariff policies and their effects have yet to settle. Trump heard that as criticism, and said he wants to oust Powell, to lower the cost of borrowing immediately, and acknowledge the genius of Trump as economic guru over all others.
Agreeing on Economics?
The importance of common acceptance about how the economy is faring is more important than simple politics. It’s about the ability to arrange for individual and household spending and savings, about how businesses know that they can invest wisely, about how international allies and foes know for sure how to engage with us as a nation.
That Trump wants happy talk about practical economics as he is changing the fundamentals of free trade is not only wrong, but delusional.
At the heart of Trump’s leadership are three principles: Trump’s often self-serving opinions should be the only ones that matter, that all Americans should love the results even as they find themselves the victim of his bad judgment, and that all issues last about one day. Those are as true for consumer prices where measurable results of tariff policies that even the Wall Street Journal editorial board calls “dumb” as it is for declaring repeatedly that Trump won the 2020 elections, which he lost. As we’re now seeing with threats to walk away from ceasefire talks between Russia and Ukraine, he shies away from the hard work of persuasion.
It’s a weird construct for Trump, who also insists on presenting himself as the voice for the “forgotten,” even as he is forgetting the very same people all over again. And it is an explanation for sudden new public response to the Bernie Sanders-Alexandra Ocasio-Cortez rallies even in Republican areas of the country.
If Trump wants to pursue distinctly unpopular programs, he should at least stand up for them without demanding that we see night for day. If tariffs are truly going to achieve his multiple goals of erasing trade deficits, reshoring American manufacturing and paying for huge tax cuts for the wealthy, Trump at least should acknowledge that it will cost taxpayers more.
The curious thing about the Trump presidency is the gap between what he says and what he gets done.
There is no chance that cutting as much as a third of all money that goes to Health and Human Services, for example, can possibly result in better health outcomes, or that shutting down phone customer service for Social Security can make necessary contact for seniors and the disabled easier or more streamlined. Spending effort, likely futile effort, to denude Harvard University and other colleges of tax-exempt status will have absolutely no effect on whether antisemitism disappears in a country where Trump is helping to build hate for others or even on how chemistry and dance are taught.
Measuring Effectiveness
Without goals in mind, the administration simultaneously is trying to handle negotiations with 70 or more countries over trade that Trump thinks should be dollar-for-dollar equal, remake federal agencies and rid itself of spending and workers and negotiate with Congress over a budget that on its face requires huge cuts in social services.
The “big, beautiful bill” that Trump wants jammed through on a simple-majority vote will require raising debt ceilings and cutting upwards of $880 billion from Medicare and Medicaid. Yet, we continue to hear that Trump is not touching those two health payment programs or Social Security. It doesn’t wash. Nor do announcements that 80,000 will be let go at the Veterans Administration square with preserving health benefits and access for veterans, or the idea that canceling billions of dollars’ worth of research into cancer, communicable disease tracking or Alzheimer’s will result in positive outcomes for Americans.
Meanwhile, billionaires seem to be doing quite well for themselves, and those who have been shorting the financial markets for gain collected bigtime on the roller-coaster markets that have swooped in value because of tariff instability.
Despite a campaign based on promises to lower the cost of living for those frustrated by persistent inflation, we’re seeing the opposite — a general increase of consumer prices over Trump-created tariff problems. Recent polls show that a majority of Americans do not support the president’s handling of the economy and blame him for what is going on, not Joe Biden.
The BLS measures — which preceded blanket tariffs of 10 percent on all goods and 145 percent on Chinese-made goods — show the consumer price just slightly down from February. Food prices at the grocery store increased from February, when prices remained relatively flat compared to the month before. We have yet to see a measurement post-tariffs.
But a visit to any supermarket shows that directly.
We don’t need Trump’s opinion to assess whether we are better off now than before the elections.
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