Pain in the Aisle

While baloney is in ample supply at the White House

Dan Rather and Team Steady Sep 2

Credit: Getty Images

Anyone who has bought groceries recently knows prices are up, in some cases way up. The cost of everything from milk to beef to lettuce has increased since Donald Trump took office. That, plus employment worries, a housing shortage, and tariffs are causing a majority of Americans to be pessimistic about the economy in general and their futures specifically.

The very issue that ushered Trump back into the White House is now potentially big trouble for him, though he is happy to tell you otherwise. Trump claims all the normal measures point to a robust economy: GDP growth, low unemployment, increases in foreign investments, a hot stock market, and relatively low inflation.

Just last month, Trump said, “The economy’s doing great.” And “economic growth has shattered expectations.”

So, traditional economic indices, according to the president, signify a thriving economy. But for the average American, who measures economic security differently than the billionaire sitting in the gilded Oval Office, things are not good — and getting worse.

Does this phenomenon sound familiar? President Joe Biden faced a similar disconnect, and many believe it cost the Democrats the White House. Trump has reason to worry.

A new Wall Street Journal/NORC poll showed an anxious electorate. Eighty-six percent of those polled are stressed out about the cost of groceries — 86%! Seventy percent believe the American dream of home ownership is unattainable, if it ever existed at all — and that includes 55% of Republicans.

The last thing a politician wants is a population that does not have confidence in the economy. Unfortunately for Trump, that is where we are. Only 25% of Americans think their standard of living will improve over the next year, a record low.

While the MAGA mediasphere will continue to trumpet Trump’s optimistic economic outlook, it may not be enough to keep everyone in the tent. Every American has firsthand exposure to economic conditions — in contrast to an issue like immigration, where many believe what they are told.

If folks are having trouble affording their rent or mortgage, paying their car loans, saving for college or retirement, no amount of cheerleading from “Fox & Friends” will convince them otherwise. And that is to say nothing of families who struggle just to put food on the table.

What’s really going on to cause such uncertainty, and in many cases, outright fear?

The fallacy of “low” inflation
For 40 years, Americans enjoyed historically low inflation rates. Then the pandemic messed with just about every economic lever, and inflation ballooned. It eventually came down during the second half of Biden’s term and has continued to inch downward for the past eight months.

But here is the thing about inflation — any amount hurts. Just because it is on the low side still means prices are rising. Telling people it could be worse, especially after weathering record high inflation during the pandemic, will not win you friends or votes. And indications are it is heading back up.

Employment uncertainty & the wage gap
While the unemployment rate remains low, it looks like it may not stay that way. The weaker-than-expected July jobs report prompted Trump to fire the head of the Bureau of Labor Statistics. The canary in the cubicle is Black unemployment. Black Americans historically tend to be the first to lose their jobs. Nationally, the unemployment rate is 4.2%, but for Black people it has risen to 7.2%, the highest level since the pandemic.

For many, wages have stagnated. Hourly wage growth is at five-year low. Couple that with the aforementioned inflation, and people are feeling the squeeze.

Home-buying hell
Home ownership is a hallmark of the American dream, but 56% of Americans have little or no confidence that they will ever have the means to buy a home, according to the WSJ/NORC poll. The barriers to homeownership are real.

The affordability crisis is driven by a huge deficit in available homes. According to Zillow, there are 4.7 million fewer homes on the market than buyers. Even if you can find a house, you may not be able to afford it. Zillow estimates the average worker would need an almost $18,000 raise just to qualify for a mortgage, after saving for the down payment.

Because rents are high and the path to homeownership is challenging for so many, 8 million American families are now sharing homes with non-family members.

The tipping point
Because the Trump administration thinks its new “no tax on tips” policy is a winning one, Treasury Secretary Scott Bessent has been out selling it. If this is the best they can do, they should be worried. Here are the devilish details.

Yes, workers (there is a list of 68 occupations, including tattoo artist, golf caddy, and dog walker) who make tips as part of their compensation will not pay federal taxes on those tips. But there are several buts: The policy does not apply to state and local taxes; it is a deduction, not an exemption; workers can deduct a maximum of $25,000 in tip income; tips will still be subject to payroll taxes (for Social Security and Medicare); and the policy expires in 2028 — conveniently, right after the next presidential election.

Trump did get some excellent economic news today, though it applies only to him and his family. The Trumps collectively made about $5 billion on Monday after their new crypto venture, World Liberty Financial, opened trading of a new digital currency. The staggering payday makes Trump’s crypto business his most valuable asset, eclipsing his real estate holdings. He has now made more personal profit while in office than any other president in history — by far.

Many die-hard Trump supporters will believe him when he insists that his economic policies are great for the country, not just for him, his family, and their wealthy peers. But many independents and swing voters who have previously voted for him may not.

Who can say with certainty how this will all play out over the long haul? But Democrats would do well to heed James Carville’s famous reminder, “It’s the economy, stupid,” ahead of the 2026 midterms and the presidential election in 2028.

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Dan