President Donald Trump made a passionate protection of the US economy throughout his State of the Union address Tuesday evening.
“Inflation is plummeting, incomes are rising fast. The roaring economy is roaring like never before.”
Hyperbole apart, he’s proper: America’s economy is robust. But Trump is missing the level.
Affordability, not financial energy, drives voters to the polls. Most Americans don’t care a lick about GDP, CPI, PCE or any of the different acronyms or knowledge factors that present the economy is on the proper observe. They care about their job safety and people financial fears that hold people up at evening: determining tips on how to to pay for groceries, housing, well being care, automotive funds, school and little one care – all of which hold getting costlier.
Trump recommended that there’s nonetheless work to be performed to Make America Affordable Again™️ and outlined some new insurance policies to handle Americans’ monetary issues.
But Trump’s message largely centered on American exceptionalism, his financial achievements, low inflation and sturdy overseas funding. He blamed his predecessor for ruining the economy and praised his administration’s work to rescue it.
“I inherited an economy that was on the brink. Now our economy is literally the envy of the world.”
There’s a problem with that technique, although.
Want proof? That final quote wasn’t from Tuesday’s speech. That was from the 2024 State of the Union, delivered by former President Joe Biden, who misplaced the election eight months later.
Trump’s message, at the very least on paper, is largely right. Jobs, wage progress, shopper spending and inflation underneath Trump look pretty decent or have been largely steady. The inventory market is close to a file excessive.
The US economy grew 2.2% in 2025, very a lot in keeping with the final three years of strong financial progress. The economy slowed down greater than anticipated at the finish of the 12 months, however the longest-ever authorities shutdown stymied progress that must be made again this quarter.
Last 12 months wasn’t an amazing 12 months for the labor market by any stretch. But unemployment stays low, and stronger-than-expected hiring in January suggests 2026 could possibly be a significantly better 12 months for job creation.
Inflation seems to be on the downswing once more after a bumpy experience in 2025. And paycheck progress has been outpacing inflation for practically three years, serving to Americans stretch their {dollars} additional.
Wealthier Americans are benefitting financially from the optimistic financial tendencies, whereas lower-income households are more and more discovering themselves left behind.
That K-shaped pattern isn’t new, however the hole between the haves and the have-nots has been widening lately, notably as the housing market stays largely frozen. Folks who personal houses – notably those that refinanced with traditionally low charges throughout the pandemic – are for the most half higher off than people who find themselves attempting and largely failing to search out anyplace inexpensive to reside at present.
Rising costs for requirements have harm, too. And curtailed social companies haven’t helped issues.
That has led the most weak to make tough decisions. Delinquencies are on the rise, and a rising variety of Americans are more than three months late on their loans.
Trump on Tuesday blamed Democrats for the inflation disaster that despatched costs surging greater than 20% throughout Biden’s time period, a shock that Americans are nonetheless adjusting to. But Trump additionally defended his personal tariffs, which added $1,000 in tax bills for the common American family final 12 months, in accordance with the conservative-leaning Tax Foundation.
After a Supreme Court ruling final week that discovered the bulk of Trump’s tariffs unlawful, Trump sharply criticized that call and instantly introduced alternate authorities to levy steep tariffs once more. Although tariffs haven’t despatched costs skyrocketing as many feared, they continue to be amongst Trump’s least-popular insurance policies and function a political vulnerability for Republicans forward of this 12 months’s midterm elections.
After a whirlwind of affordability proposals to start out 2026, Trump unveiled a couple of extra Tuesday evening, together with a retirement plan for Americans with out entry to a 401(okay) and necessities that tech corporations help defray the elevated price of electrical energy attributable to surging demand from AI knowledge facilities.
Trump additionally highlighted the insurance policies he’s already enacted, together with tax cuts, Trump Accounts for infants and quite a few efforts to decrease prescription drug costs for a lot of sufferers.
It’s a method that hasn’t precisely paid off up to now: The affordability initiatives have received mixed reviews and can take time to work their means by the economy. And Trump isn’t precisely sticking to the script.
The president’s State of the Union tackle comes amid a type of financial roadshow to hammer house a message that his employees need him to speak: that the economy is robust due to his administration’s actions. But the messaging has at instances obtained misplaced as Trump veers off script to deal with different points he seems to favor, reminiscent of immigration enforcement and unfounded accusations of election fraud.
It hasn’t helped that Trump has known as affordability a “hoax” and a battle he has received. In the meantime, Trump’s rah-rah message on the economy and commerce is falling on deaf ears and dangers making him look out of contact forward of a vital election.
“America is rising. We have the best economy in the world. And since I’ve come to office, our GDP is up, our trade deficit with China is down to the lowest point in over a decade, and we’re standing up against China’s unfair economic practices.”
Whoops, that was Biden in 2024 once more.