WASHINGTON\u00a0\u2014\u00a0With three months remaining until election day, there is now little the Trump administration can do to bring relief to Americans battered by years of stagnant wages and steep inflation before they hit the polls, experts say \u2014 complicating midterm campaigning for Republicans and sharpening the opportunity for Democrats to win back some control in Washington.<\/p>\n
That\u2019s in part because the Trump administration has very few levers to turn the tide in such a short period, and has shown little interest in using those it does have, experts said. Rather, President Trump has persisted in waging war in Iran and pushed forward with new tariffs on trade partners despite both contributing to soaring costs for food, gas and other basic necessities.<\/p>\n
Other options, such as issuing rebate checks for consumers or releasing strategic oil reserves, would be costly in the long run, experts said.<\/p>\n
\u201cThere isn\u2019t much available on a 14-week clock that doesn\u2019t cost more later than it delivers now,\u201d said Patrick Harker, professor at the University of Pennsylvania Wharton School and former president of the Federal Reserve Bank of Philadelphia.<\/p>\n
The Federal Reserve on Wednesday also declined to use its primary tool for reducing inflation \u2014 increasing interest rates \u2014 by instead holding rates steady<\/a>. Trump had not supported a rate increase, instead pressuring the central bank to lower rates, which can lower borrowing costs but increase inflation.<\/p>\n Some factors driving up costs are virtually impossible to resolve in the near term, such as damage to oil refining capabilities in the Middle East as a result of the war in Iran. Others are already baked into pricing to come as a result of tariffs and fuel costs, including for groceries, experts said.<\/p>\n Incumbent parties often suffer midterm losses when voters are broadly pessimistic about the economy, as they are now despite remarkable resilience in the U.S. labor market and strong stock returns.<\/p>\n Consumer prices declined in June<\/a> for the first time in six years, largely thanks to a decline in gas prices as the Iran war appeared headed toward a resolution \u2014 which is no longer the case.<\/p>\n New data Thursday showed the U.S. economy growing at a sluggish 1.5% pace from April through June. It also showed consumer spending and inflation slowing down. But slowing inflation<\/a> has not meant lower costs.<\/p>\n As the Iran war entered its sixth month this week, average gas prices nationally climbed back above $4 a gallon. On Wednesday, the price of Brent crude oil rose<\/a> to $90 a barrel as the U.S. and Iran carried out new strikes.<\/p>\n The White House did not respond to a request for comment. However, Trump asserted Wednesday that the economy is strong \u2014 citing in part new U.S. automobile plants as evidence \u2014 while slamming the Federal Reserve\u2019s decision to leave interest rates unchanged.<\/p>\n \u201cThey want to keep rates up, but we will fight through this,\u201d Trump told reporters at an Oval Office event. \u201cWe have things that are going on in our country in the likes of which no one has ever seen.\u201d<\/p>\n As Democrats have seized on the economy as the midterms\u2019 defining issue, Trump has promised improvements but also called affordability concerns a \u201choax.\u201d Last week, he rejected the notion that he should rethink his unpopular Iran strategy because of the looming midterms.<\/p>\n \u201cNo, the election \u2014 I can\u2019t think about that having to do with this,\u201d he said before renewing attacks last week. \u201cI think people are very impressed.\u201d<\/p>\n Jonathan Nagler, a New York University professor who studies how the economy shapes politics, said it is impossible to predict how voters will feel about the economy three months from now, because there are so many variables.<\/p>\n But data make clear that \u201cthe better the economy is, the better the incumbent does,\u201d and voters will blame Trump and his party for their economic woes if they persist, Nagler said \u2014 particularly with gas prices, which are \u201ca non-trivial expense\u201d that is \u201csuper directly tied to Trump.\u201d<\/p>\n \u201cDemocrats can draw a very straight line from a decision by Trump to go to war with Iran, and gas prices rising. That is just very, very easy to explain to people in a pretty convincing way,\u201d Nagler said. \u201cDemocrats can try to say, \u2018Hey, there should be some accountability here.\u2019\u201d<\/p>\n Diane Swonk, chief economist at KPMG, said inflation has compounded for years \u201cto make the level of prices too high for too many,\u201d and is clearly the biggest economic issue facing many Americans.<\/p>\n \u201cAnd that\u2019s not likely to change in the next few months, where you still not only have some of the spillover effects of the war in Iran to play out \u2014 most notably in terms of the fall harvest and food prices, which will go well into 2027 \u2014 but also just the on-again, off-again truces and the damages to refining capacities,\u201d she said.<\/p>\n All of that is adding to \u201csimmering\u201d service sector inflation and Trump\u2019s latest tariffs, which mean \u201cmore paperwork, more costs, and another bump in prices in the pipeline,\u201d Swonk said.<\/p>\n Harker said the administration has no good options for bringing down prices by November. Reducing tariffs takes time to filter down to shelf prices, so that can\u2019t offer a quick fix even if Trump were to decide to cut them, he said.<\/p>\n The biggest variable between now and November is energy, Harker said, and no economic tool allows the administration to control what happens in the Persian Gulf. Even if Trump\u2019s war with Iran were to end, economists say<\/a> it would take a significant amount of time for gas prices to come down.<\/p>\n The Fed could decide to raise rates in September, but Harker said that would take time to filter through the economy and would do \u201cnothing\u201d ahead of November.<\/p>\n On the campaign trail, Trump promised to immediately \u201creverse the disastrous effects of [President] Biden\u2019s inflation and rebuild the greatest economy in the history of the world,\u201d one where \u201cincomes will skyrocket, inflation will vanish completely, jobs will come roaring back, and the middle class will prosper like never, ever before.\u201d<\/p>\n A recent CNN poll<\/a> found that 65% of Americans believe Trump\u2019s policies have worsened economic conditions in the country, while less than a quarter \u2014 22% \u2014 said they had improved conditions, and that 67% believe Trump\u2019s choices in Iran hurt the U.S.<\/p>\n The poll found Trump had a 34% approval rating, matching a career low from the end of his first term, and that his support fell even lower on key issues: to 28% on Iran, 25% on inflation and 21% on gas prices.<\/p>\n A recent Pew Research Center survey found most Americans aren\u2019t feeling great<\/a> about the economy \u2014 with 24% rating economic conditions as excellent or good, 41% rating them as \u201conly fair,\u201d and 35% rating them as poor. It also found that voters want candidates running for Congress in November to talk about economic issues<\/a>.<\/p>\n