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5 Reasons Trump's Economy Stinks and 10 Things the Dems Should Do About It
The Trump economy is truly sh*tty for most Americans. Democrats need to show America that they can be better trusted to bring prices down and real wages up.
Nov 17, 2025
President Donald Trump claimed last week on social media that “Our economy is BOOMING, and Costs are coming way down,” and that “grocery prices are way down.
Rubbish.
How do I know he’s lying? Official government statistics haven’t been issued during the shutdown—presumably to Trump’s relief (the White House said Wednesday that the October jobs and Consumer Price Index reports may never come out).
But we can get good estimates of where the economy is now, based on where the economy was heading before the shutdown and recent reports by private data firms.
First, I want to tell you what we know about Trump’s truly sh*tty economy. Then I’ll suggest 10 things that Democrats should pledge to do about it.
1. Prices Continue to Rise as Real Wages Fall
While the cost of living isn’t going up as fast as it did in 2022, consumer prices are still up 27% since the onset of the pandemic. Wages haven’t kept up.
Americans know this. In a recent Harris poll, 62% say the cost of everyday items has climbed over the last month, and nearly half say the increases have been difficult to afford.
Much of this is due to Trump’s tariffs, which are import taxes—paid by American corporations that are now passing many of the costs on to consumers. Even Trump knows this, which is why he’s removing tariffs on coffee, bananas, beef, and other agricultural commodities. But his other tariffs will remain, boosting the costs of everything else.
Every time Trump or his lapdogs in Congress tell Americans that the economy is terrific, they seem more out of touch with reality.
As a result, wages—when adjusted for inflation—have been falling, government and private-sector data show. Since the start of the year, inflation has been rising faster than after-tax pay for lower- and middle-income households, according to the Bank of America Institute.
According to the JPMorganChase Institute, the rate of real income growth has slowed to levels last seen in the early 2010s, when the economy was still recovering from the financial crisis and the unemployment rate was roughly double what it is today.
2. Job Growth Has Stalled
Americans are scared of losing their jobs. In the same recent Harris poll I referred to above, 55% of employed workers say they’re worried they’ll be laid off.
That worry is borne out in the data. Indeed’s job posting index has fallen to its lowest level since February 2021.
The Fed’s Beige Book—which compiles reports from Fed branches all over the country—also shows the job market losing steam.
The latest ADP private-sector data confirms that the labor market continued to weaken in the latter half of October, with more than 11,000 jobs lost per week on average.
Finally, Challenger, Gray & Christmas (a private firm that collects data on workplace reductions) reports that US employers have announced 1.1 million layoffs so far in 2025. That’s the most layoffs since 2020, when the pandemic slammed the economy, and rivals job cuts during the Great Recession of 2008 and 2009.
3. Homeowners Are Underwater, and Foreclosures Are Up
Nearly 900,000 homeowners (about 1.6% 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.
At the same time, filings for home foreclosures are up about 17% since the third quarter last year (according to ATTOM Data Solutions), suggesting more borrowers in trouble.
4. Corporate Profits Continue to Rise
You might think that with all these stresses on American consumers, corporate profits would dip. But in reality, US corporate profits continue to rise, and the stock market continues to hit new highs (although the stock market is wobbly, as I’ll get to in a moment).
As a result, the investor class—the richest 10% of Americans, who own over 90% of the stock market—are reaping big rewards.
How to square this with all the layoffs and so few job openings? Amazon’s profits are through the roof, but it’s laying off 30,000 people.
First, corporations are reluctant to expand and hire because of so much uncertainty about the future, caused in large part by Trump’s tariffs and his expulsion from the US of many workers critical to the agriculture and construction industries.
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.
Third, many corporations are making use of artificial intelligence. AI is boosting business productivity while reducing the demand for workers. We’re seeing that trend mostly in the technology sector, which continues to substitute AI for jobs. But the trend seems to be spreading to other industries.
5. Inequality Is Widening
Put this all together and you get a two-tier economy whose inequality gap is widening.
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 working class and poor have been in the lower one.
Now, the middle class is joining the lower tier. This new reality has huge implications both for the economy and for American politics.
The richest 10% of households—whom I’ve described as the investor class—now account for nearly half of total US spending, thanks to the stock market surge. (Thirty years ago they were responsible for about a third.)
Meanwhile, middle- and lower-income families are pulling back. They’re facing tightening budgets, higher living costs, declining real wages, and a raft of corporate layoffs.
The consequent divergence in spending—with a smaller group of people keeping the economy going—is fueling concerns that the US economy is becoming more fragile.
With the economy so dependent on the richest 10%—who in turn are highly dependent on the stock market—a stock market downturn would raise risk of a serious recession.
6. What the Democrats Must Pledge to America
The Trump economy is truly sh*tty for most Americans. Every time Trump or his lapdogs in Congress tell Americans that the economy is terrific, they seem more out of touch with reality.
Democrats need to show America that they can be better trusted to bring prices down and real wages up.
This means, in my view, promising the following 10 things. These should constitute the Democrats’ pledge to America:
- Trump’s across-the-board tariffs are import taxes that are raising the prices of just about everything American consumers buy. Democrats will eliminate them where their costs to consumers are far higher than any potential benefits in the form of new jobs.
- Another major source of high prices is monopolies—especially in high tech, healthcare, food, and finance. Democrats will vigorously enforce antitrust (anti-monopoly) laws. Giant corporations will be busted up. Mergers or acquisitions by large firms, barred.
- Workers need more bargaining power to get higher wages. Part of the answer is stronger unions. Democrats will make it easier for them to start or join unions.
- The national minimum wage will be raised to $20 an hour. No one who works full time should be in poverty.
- Housing cost increases will be slowed by stopping private equity firms from buying up large tracts of housing and colluding on prices.
- Healthcare costs will be lowered by making Medicare available to everyone.
- Working families will get help with childcare and eldercare.
- They’ll also get paid family leave.
- If adequate-paying jobs are unavailable, workers will also have access to a universal basic income. It won’t make families comfortable, but it will be enough to keep them out of poverty.
- Taxes will be raised on the wealthiest to pay for this.
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When Will the Contented Class Revolt Against Trump?
When will these contented ones collectively start saying, “Enough is enough” and it’s time to say to Donald Trump, “You’re Fired”?
Nov 16, 2025
The reason the famous and prolific Harvard economist, John Kenneth Galbraith, is often referred to as a political economist can be seen in the continuing relevance of his book The Culture of Contentment (1992). His thesis explains in significant part why President Donald Trump’s wrecking of America has not more significantly collapsed his support, now below 39% approval.
In the US, the contented classes hail from both parties. They are not a majority of the population by any means, given that half of all Americans are “poor” or “near poor.” They are a majority of the politically and economically influential people who support policies that maintain their comfort at the expense of the necessities of the “functional underclass” left behind in poverty. The contented classes include the super rich, of course, but also the managerial, professional, and wealthier working classes. In addition, they vote at a higher percentage than the poor.
Before Trump, this contented class, which includes members of Congress, was doing well, so much so that they stood in the way of increasing the federal minimum wage, frozen at $7.25 per hour, or increasing Social Security benefits, frozen for over 40 years. These changes could have been paid for by hiking Social Security taxes on, you guessed it, the contented classes. Despite public opinion polls favoring expanding the social safety net, the contented class wants the status quo of no paid sick leave, no paid family or maternal leave, no subsidized childcare, and no universal paid vacations. Western European countries all have a more robust social safety net than the US.
When you crank in the damage done by Trump and his Trumpsters in Washington, DC, members of the contented classes are largely unaffected. The costs of universally damaging programs cutting preparedness for climate violence, pandemics, huge expansions in the police state against immigrants, and the military-industrial complex are not felt where the contented classes live, work, and raise their families.
Trump’s tyrannies and treacheries; his open flouting of the laws (the establishment likes such flouting to be discreet); and his revolting, foul-mouthed defamations tower over Richard Nixon’s transgressions.
We can make a list of the terrible closedowns or strip-mining of federal agencies’ law enforcement and regulatory initiatives. Very few exclusively impact the contented classes. Some may actually benefit.
Other Trump moves, many of them illegal and unauthorized by Congress, delight these people. They support lower taxes on upper-income people and businesses, large or small. The Internal Revenue Service is now going further with its unauthorized dilutions of the 15% minimum tax on corporate profits. The rising stock market adds to the complacency of the contented classes.
The most cruel and vicious actions by Trump—abolishing the US Agency for International Development, medical, water, food assistance to desperate millions abroad—cuts to Meals on Wheels, Head Start, Medicaid, Supplemental Nutrition Assistance Program (SNAP) impact the masses—tens of millions of them directly and daily. They do not reach the contented class members of our population.
This is not to say that millions of these contented persons do not care what is happening to their fellow citizens. But normative caring is not viscerally feeling the pain and suffering, the anxiety, dread, and fear of losing healthcare coverage; tomorrow’s meal; the brunt of chronic indebtedness; or abandoning the disabled, the sick, and the casualties of the workplace.
Galbraith wrote that living in their contented culture leads to short-term thinking, underinvestment in public goods, and ignoring the widening inequality between the “haves” and the “have-nots.” Inequality also stems from making money from money—a source of wealth denied to people living paycheck to paycheck.
The capture of the Democratic Party by this complacent class has become so pronounced that the blue-collar working-class members have broken away from their unions and parents or grandparents’ devotion to the FDR-like New Deal politics and fallen prey to the rhetorical seduction of the corporatist GOP.
What could Trump do to alienate large portions of this contented class, which Galbraith argues has been the only force that can disrupt the status quo? When will these contented ones collectively start saying, “Enough is enough” and it’s time to say to Donald Trump, “You’re Fired”?
When the following come together—serious recession, serious inflation, with destabilizing (to their businesses) tariff-driven surging prices; a reckless foreign war quagmire; plunging stock markets; daily spreading chaos; and the media-exposed sickening stench of raw corruption flowing from the White House throughout the upper realms of the executive branch—the contented classes should join the resistance to the Trump madness.
Back in 1974, the Republican establishment decided it was time for Richard Nixon to go, despite his having won reelection in 49 of 50 states in 1972, with a 60% approval in the polls. He was not considered “useful” to the power brokers anymore.
Trump’s tyrannies and treacheries; his open flouting of the laws (the establishment likes such flouting to be discreet); and his revolting, foul-mouthed defamations tower over Richard Nixon’s transgressions.
History instructs that latent revulsions and fears by the power elites are often launched onto the public stage by some specific outrage, decadence, or bullying. Stay tuned. With Dictator Donald (he regularly intones, “This is only the beginning”), THE WORST IS YET TO COME.
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The G20 Is a Failure, But Can It Do Better to Correct Past Mistakes?
World leaders heading to the G20 summit should use this rare multilateral space to advance a more equitable and sustainable global economy. Will they?
Nov 15, 2025
Multilateralism is in tatters. Instead of rules-based, consensus agreements, global economic relations have largely devolved into one-on-one arm-twisting and name-calling, alternating with fawning sycophancy and lavish personal gifts. In recent negotiations with Asian leaders, President Trump scored a gold golf ball, a gold crown, and a gold-flecked dessert.
In a world already divided by extreme inequalities, the collapse of multilateralism makes it even more likely that the most powerful players — the largest economies and the wealthiest corporations and individuals — will score the best deals. Small countries and ordinary people, from Iowa soybean farmers and Mexican factory workers to digital service consumers in Cambodia, are even more likely to get the shaft.
The G20 is a space that was intended to catalyze multilateral action. In fact, it touts itself as the “the premier forum for international economic cooperation,” and it is the one place where leaders of the world’s largest economies sit down together at least once a year for face-to-face dialogue.
South Africa will host this year’s G20 summit from November 22 to 23, and the United States will host the next one in December 2026. Do we have any reason to think this forum holds potential for not only restoring multilateralism but also advancing a more equitable global economy?
This is a question I’ve grappled with over the past several months as part of a team of analysts from the UK, Brazil, South Africa, and other countries. In our new joint report, The G20 at a Crossroads, we document a few examples of decisive actions this body has taken during its nearly two decades of existence.
In the midst of the financial crisis that erupted in 2008, for instance, labor unions and others successfully lobbied G20 leaders to adopt coordinated stimulus measures that helped avoid a depression-level global collapse.
In response to the Covid-19 pandemic, the G20 approved of at least some debt relief for low-income countries and authorized $650 billion in financial aid in the form of “special drawing rights,” the largest-ever allocation of this IMF-created international reserve asset.
These actions were far from perfect. Governments prematurely aborted the stimulus programs they adopted after the 2008 crash in favor of austerity budgets that deepened and prolonged economic crises.
Pandemic support programs were woefully insufficient for the poorest countries and failed to prevent many of them from sinking even further into debt. Between 2019 and 2023, Sub-Saharan Africa’s total external debts increased from $747 billion to $864 billion while the number of global billionaires grew from 2,153 to 2,640. Overall, 3.4 billion of the world’s people live in countries that spent more money in the years 2021-2023 servicing their foreign debts than on public education or health.
What can we learn from these examples? G20 leaders obviously have the power to mobilize vast resources, but the few times they’ve used this power, the focus has largely been on containing market crises to protect the interests of the wealthiest creditors and investors rather than improving the lives of the most vulnerable.
And so while we need to push for renewed multilateralism, we cannot be satisfied with a return to old models. We need new approaches that go beyond crisis management to build a more resilient, sustainable, and just global economy for the long term.
To achieve this, the G20 must tackle what we describe in our report as the “lived crises of our time” — the daily realities of extreme droughts, food insecurity, unaffordable housing, precarious work, debt traps, and forced displacement.
Decades of neglecting these threats to global stability has undercut the welfare of people in both the Global North and South. High levels of poverty and unemployment in the developing world, for example, weaken the bargaining power of U.S. workers who are competing in a global labor pool.
Climate change, obviously, knows no boundaries. And skyrocketing inequality is fueling political polarization, authoritarianism, and xenophobia around the world, as elites deflect blame onto migrants and other convenient scapegoats instead of confronting structural failures.
Last year, the Brazilian presidency took important steps towards broadening the G20 agenda. Through diplomacy, sustained civil society engagement, and collaboration with innovative academics, they elevated critical proposals for clean energy financing, taxing extreme wealth, and valuing care work. And while they did not secure G20-wide cooperation on these fronts, their efforts gave a boost to campaigns in numerous countries for increasing taxes on billionaires and ensuring decent pay for caregivers and affordable care for those who need it.
“Wherever we live, we all want the same things — a secure place to live, a healthy environment, the ability to care for our loved ones, and the chance to plan for our future,” notes our lead report author, Fernanda Balata, of the New Economics Foundation.
With political will and a commitment to cooperation, G20 leaders have the power to deliver these basic elements of a dignified life to billions of people.
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