The Trump economy is truly awful for most Americans. Democrats need to show America that they can be better trusted to bring prices down and real wages up.<\/p>\n
A repost from 20 November 2025<\/p>\n
President\u00a0Donald Trump\u00a0claimed last week on\u00a0social media\u00a0that \u201c<\/p>\n
Our economy is BOOMING, and Costs are coming way down,<\/a>\u201d and that \u201c<\/p>\n grocery prices are way down<\/a>.<\/p>\n Rubbish.<\/p>\n How do I know he\u2019s lying? Official government statistics haven\u2019t been issued during the shutdown\u2014presumably to Trump\u2019s relief (the\u00a0White House\u00a0said Wednesday that the October jobs and Consumer Price Index reports may never come out).<\/p>\n But we can get good estimates of where the economy is now, based on where the economy\u00a0was heading\u00a0before the shutdown\u00a0and\u00a0recent reports by\u00a0<\/p>\n private data firms<\/a>.<\/p>\n First, I want to tell you what we know about Trump\u2019s truly shitty economy. Then I\u2019ll suggest 10 things that Democrats should pledge to do about it.<\/p>\n 1. Prices continue to rise as real wages fall<\/p>\n While the cost of living isn\u2019t going up as fast as it did in 2022, consumer prices are still up 27 per cent since the onset of the pandemic. Wages haven\u2019t kept up.<\/p>\n Americans know this. In a recent Harris poll,\u00a0<\/p>\n 62 per cent<\/a>\u00a0say the cost of everyday items has climbed over the last month, and\u00a0<\/p>\n nearly half<\/a>\u00a0say the increases have been difficult to afford.<\/p>\n Much of this is due to Trump\u2019s\u00a0tariffs, which are import taxes\u2014paid by American corporations that are now passing many of the costs on to consumers. Even Trump knows this, which is why he\u2019s removing tariffs on coffee, bananas, beef, and other agricultural commodities. But his other tariffs will remain, boosting the costs of everything else.<\/p>\n As a result, wages\u2014when adjusted for inflation\u2014have been falling, government and private-sector data show. Since the start of the year,\u00a0inflation\u00a0has been rising faster than after-tax pay for lower- and middle-income households, according to the\u00a0<\/p>\n Bank of America Institute<\/a>.<\/p>\n According to the\u00a0<\/p>\n JPMorganChase Institute<\/a>, the rate of\u00a0real\u00a0income growth has slowed to levels last seen in the early 2010s, when the economy was still recovering from the financial crisis and the\u00a0unemployment\u00a0rate was roughly double what it is today.<\/p>\n 2. Job growth has stalled<\/p>\n Americans are scared of losing their jobs. In the same recent Harris poll I referred to above,\u00a0<\/p>\n 55 per cent<\/a>\u00a0of employed\u00a0workers\u00a0say they\u2019re worried they\u2019ll be laid off.<\/p>\n That worry is borne out in the data.\u00a0<\/p>\n Indeed\u2019s<\/a>\u00a0job posting index has fallen to its lowest level since February 2021.<\/p>\n The Fed\u2019s Beige Book\u2014which compiles reports from Fed branches all over the country\u2014also shows the job market\u00a0<\/p>\n losing steam<\/a>.<\/p>\n The latest ADP private-sector data\u00a0<\/p>\n confirms<\/a>\u00a0that the labor market continued to weaken in the latter half of October, with more than 11,000 jobs lost per week on average.<\/p>\n Finally,\u00a0<\/p>\n Challenger, Gray & Christmas<\/a>\u00a0(a private firm that collects data on workplace reductions)\u00a0<\/p>\n reports<\/a>\u00a0that US employers have announced 1.1 million layoffs so far in 2025. That\u2019s the most layoffs since 2020, when the pandemic slammed the economy, and rivals job cuts during the Great Recession of 2008 and 2009.<\/p>\n 3. Homeowners are underwater, and foreclosures are up<\/p>\n Nearly 900,000 homeowners<\/a> (about 1.6 per cent of all mortgage holders) are now underwater on their mortgages, the highest share in three years. Many of these buyers purchased in 2022-24 with low down payments in markets that have since cooled.<\/p>\n At the same time,\u00a0<\/p>\n filings for home foreclosures<\/a> are up about 17 per cent since the third quarter last year (according to ATTOM Data Solutions), suggesting more borrowers in trouble.<\/p>\n 4. Corporate profits continue to rise<\/p>\n You might think that with all these stresses on American consumers, corporate profits would dip. But in reality, US corporate\u00a0<\/p>\n profits continue to rise<\/a>, and the stock market continues to hit new highs (although the stock market is wobbly, as I\u2019ll get to in a moment).<\/p>\n As a result, the investor class\u2014the richest 10 per cent of Americans, who own over 90 per cent of the stock market\u2014are reaping big rewards.<\/p>\n How to square this with all the layoffs and so few job openings? Amazon\u2019s profits are through the roof, but it\u2019s laying off 30,000 people.<\/p>\n First, corporations are reluctant to expand and hire because of so much uncertainty about the future, caused in large part by Trump\u2019s tariffs and his expulsion from the US of many workers critical to the\u00a0agriculture\u00a0and construction industries.<\/p>\n Secondly, profits are being led by the six major high tech firms, whose monopolistic hold over their markets has given them the power to raise prices.<\/p>\n Third, many corporations are making use of\u00a0artificial intelligence. AI is boosting business productivity while reducing the demand for workers. We\u2019re seeing that trend mostly in the\u00a0technology\u00a0sector, which continues to substitute AI for jobs. But the trend seems to be spreading to other industries.<\/p>\n 5.\u00a0Inequality is widening<\/p>\n Put this all together and you get a two-tier economy whose inequality gap is widening.<\/p>\n America has always had a two-tiered economy, but for the last 80 years, the middle class has been in the upper tier along with the wealthy, while the\u00a0working class\u00a0and poor have been in the lower one.<\/p>\n Now, the middle class is joining the lower tier. This new reality has huge implications both for the economy and for American politics.<\/p>\n The richest 10 per cent of households\u2014whom I\u2019ve described as the investor class\u2014now account for <\/p>\n