Trump says he ‘defeated’ inflation — so why do prices keep going up?
For the legions of cash-strapped shoppers wrestling with skyrocketing consumer prices, President Trump’s alleged Golden Age is an age wracked with debt.
Millions of seniors and families are shelling out more, for everything from medication and baby formula to furniture, electronics and food. More than three in four Americans now rate the U.S. economy as poor, and they blame Trump’s boneheaded trade policies for heaping pain upon pain.
They aren’t wrong. In fact, few stretches in American history have yielded price spirals as brutal or wide-ranging as those that define Trump’s first 10 months back in the White House.
This year will come to be known as the year everything in the country got more expensive. Voters can thank Republicans’ make-it-up-as-you-go economic ideas for all that extra grocery-bill heartburn.
Last month, Trump boldly declared that inflation was “defeated” and everything was back to normal. Does the latest round of price hikes feel normal to you? Analysts at the Harvard Business School Pricing Lab spent much of the year tracking real-time price data in response to Trump’s wave of tariffs, including a new bundle of levies that will eventually spike furniture, cabinetry and lumber prices by up to 50 percent.
What they found was shocking: Trump’s tariffs didn’t just boost the price of imported goods — they made products produced domestically more expensive as well. On average, products produced in America rose by about half as much as imports, but all classes of goods got more expensive.
HBS Pricing Lab founder Alberto Cavallo also found that, despite Trump’s claims, foreign manufacturers aren’t eating tariff-related costs. “If you look at import price indices … produced by the BLS, they are not falling. In fact, they’ve actually increased. So that suggests foreign exporters are not lowering their export prices.”
If foreign producers aren’t absorbing the rising cost of goods, that leaves the American consumer. And absorb the prices they are! A survey by The Century Foundation found that 40 percent of Americans have eaten into their savings in order to afford basic necessities, while 37 percent have turned to credit cards and other forms of debt. For 70 percent of households, consumer costs have risen so much that they now struggle to pay bills that were once an afterthought.
Unlike passing on the latest model iPhone or skipping a vacation, families can’t realistically skip feeding their kids. Except they are. The Century Foundation found that 25 percent of respondents say they or someone in their household has skipped a meal in order to save money over the last 10 months. For Hispanic families, that number rises to 41 percent. That’s little surprise in a country where the price of staples such as beef and orange juice have risen more than 10 percent since this time last year.
American workers can’t catch a break; their lunches are now more expensive than during the Biden years. The National Restaurant Association, a trade group, now estimates that restaurants will need to jack up prices by over 30 percent just to maintain their profit margins. That means basics like Americanos, bagels, burritos, sandwiches, pizza slices and burgers will soon cost you a whole lot more — without a pay raise to match. Your future $19 burger is arriving courtesy of the Republican Party!
When Trump promised to foster a new golden age, few people thought his economic schemes would be picking the gold out of their pockets. Yet Americans now feel poorer and less hopeful about their own economic futures than they did a year ago. Taking your kids out for dinner at Applebee’s now requires serious financial planning. A movie date now needs to be balanced against the sky-high costs of groceries and gasoline.
Few people think it feels very fun to be an American these days.
Instead of a bright new economic dawn, Trump and his Republican cronies are ushering in an era of stagflation not seen since the Carter days. Inflation has been on the rise since July as employment falls and wages stumble. Trump can crow all he wants about bringing prices down, but that bluster means little when American families are watching their purchasing power disappear before their eyes.
The Republican Party is great at convincing voters of a great many untruths, but no one can convince a family that they have money when they don’t. Trump still believes his spin job can persuade those frustrated Americans that they aren’t facing serious financial struggles. They can’t afford to buy the lie he’s selling.
Max Burns is a veteran Democratic strategist and founder of Third Degree Strategies.