It’s been a bruising week for Donald Trump. And it’s only Thursday. When things go south, Trump’s go-to is to deflect and distract and claim no personal responsibility. Or just lie. Safe to say all those boxes have been checked. His petulant child routine has become incredibly predictable. But first, the troubling economic news.
An economy that was chugging right along until late January, when Trump took office; the economy that Trump was supposed to “fix.” Trump claims he inherited a disaster. Just you wait. Not only has he not fixed it, he has made it worse.
Interest rates were high. Still are. The American dream of home ownership remains frustratingly out of reach for many. Housing rental prices overall continue to climb, outpacing inflation.
Consumer confidence hit a four-year low this week. The expectation index, which measures near-term economic trends, is at a 12-year low, down to 65.2. A score of 80 is the threshold for negative economic growth. Predictions of a recession are on the rise — a recession Trump seems to believe is worth the cost. Anxious Americans aren’t buying it.
Consumer confidence is a harbinger of consumer spending, which accounts for two-thirds of U.S. economic activity. Economists point to declining consumer confidence as a big reason the country’s biggest retailer, Walmart, lost $22 billion in value on Wednesday. Walmart’s CEO, Doug McMillon, said he has noticed “stressed” behavior among Walmart shoppers, who seem to be more budget-constrained. Just how big is Walmart? Its annual sales dwarf those of Amazon, the second-largest retailer, by more than half.
So how did Trump tank Americans’ buying confidence in less than 100 days? Trump’s economic “policies” are sowing uncertainty and unpredictability among markets and the Fortune 500. And it is spilling over to consumers. The biggest culprit is Trump’s on-again, off-again tariffs. The latest, announced yesterday, is a 25% tariff on all foreign-made cars and car parts.
This new tariff will allegedly, supposedly, go into effect next week, at the same time as his previously announced, then delayed tariffs on things such as electronics and fruits and vegetables. Combined, these tariffs will hit our closest trading partners — Mexico, Canada, Japan, South Korea, and the European Union — hard.
“This is the beginning of Liberation Day in America,” the president said at the White House. “We’re going to take back just some of the money that has been taken from us.”
Trump still doesn’t seem to understand — or care — how tariffs work. Or how they are hurting the economy.
Americans bought a lot of foreign cars in 2024 — $214 billion worth, according to the Commerce Department. Economists predict the new tariffs will add at least $5,000 to $10,000 to the price of each import. If you think the car companies will absorb the cost, think again. This at a time when consumer confidence is stalling (see above), interest rates are high, and insurance prices are rising.
The president says the new tariffs are meant to boost the American auto industry. But that is a cockamamie plan. First of all, U.S. automakers have operations in Mexico and Canada, so the tariff will hurt U.S. auto sales, too. Retaliatory tariffs by countries that import American cars are coming.
As for bolstering U.S. car manufacturing, it would take years and tens of billions of dollars to build new plants and reorient the supply chain to North America. Reindustrializing the country may be a good idea, but this wrecking crew approach isn’t the way to do it.
Now to another big story of the week that Trump wishes would go away. The Atlantic's editor-in-chief, Jeff Goldberg, published a deeply troubling piece on Tuesday. Somehow National Security Adviser Mike Waltz added him to a group chat on the messaging app Signal. Also on the chat: the vice president, the CIA director, the director of national intelligence, and the secretaries of defense, treasury, and state.
The reporter was shocked to read — on his phone — of U.S. battle plans to attack Houthi rebels in Yemen from Secretary of Defense Pete Hegseth himself, just hours prior, on a publicly available app! It has become one of the most bewildering intelligence breaches in U.S. history.
While Waltz is in trouble over creating the chat on an unsecured phone app and unknowingly allowing a reporter to join, it’s Hegseth who is in the hottest of water. Because he posted actual war plans to the group, he jeopardized the lives of American combatants.
Kudos to Goldberg and The Atlantic for publishing the exchanges.
At any other time in American history, heads would roll, or at least an investigation would be launched by an inspector general. But Trump has fired all of them. The Justice Department or FBI could investigate, but they’re so in the tank for Trump it will never happen. Attorney General Pam Bondi said that while the material discussed on the chat was “sensitive,” she claims it wasn’t “classified.” Really? Plans about an imminent military attack against a foreign nation are not classified?
“If you’re running the security directorate of a hostile nation, savor this moment. It’s never been easier to steal secrets from the United States government. Can you even call it stealing when it’s this simple?” wrote Noah Shachtman in The New York Times.
So, at this moment it looks doubtful that anyone will lose their job over this. Trump has shrugged it off. He deflected blame, calling the reporter a “total sleazebag.”
Trump hasn’t had a great week when it comes to politics, either. Democrats notched a surprise upset in a state Senate race in Pennsylvania. While the victory does not affect Republican control of the Pennsylvania Senate, it may be a sign of Republican vulnerability. Trump won the district by 15 points less than five months ago.
New York Congresswoman Elise Stefanik has been waiting months to be confirmed as U.N. ambassador. Her patience did not pay off. Republicans are so worried about holding on to their razor-thin majority in the House of Representatives, Trump pulled her nomination today. Stefanik’s seat has become even more important because of two closer-than-expected special elections next week for House seats in Florida. Yes, Florida.
One of those elections is to fill the seat of Mike Waltz, who is, at least for the moment, national security adviser.
As mentioned earlier this week, Trump’s aggregate approval ratings are now trending downward. Support is eroding among some groups who helped put him back in the White House. Fifty-two percent of middle-class voters broke for Trump in 2024. In a The Economist/YouGov poll out this week, 49% of middle-class respondents disapprove of the president, while 47% approve. The same poll a month ago had an approval rating of 50%.
If you want to know what’s going on, what’s really going on, be careful of the messages that come from the White House. In the middle of the national security fiasco, new tariffs were announced. Trump’s attempt to change the narrative, to throw the public off the scent is transparent and ill-conceived. If that is the plan, one needs to change the narrative to a positive, not to a bigger problem of your own making.
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