As Trump’s Needless Trade War Tanks the Economy, Republicans Target Medicaid to Pay For Billionaire Tax Breaks

As Trump’s Needless Trade War Tanks the Economy, Republicans Target Medicaid to Pay For Billionaire Tax Breaks

This week, President Donald Trump and his administration continued to mislead the public about an impending recession, with false claims that nothing is wrong and recessions are “okay.” Meanwhile, the prices of essentials like cribs and “the thing you carry babies around in” are skyrocketing. It’s clear Trump is driving working families toward a self-inflicted recession, and rather than reverse his course, Trump and Congressional Republicans continue to pursue another tax giveaway for the wealthy.

At the same time, the Congressional Budget Office released new analysis demonstrating that the Republicans’ budget proposal would strip Medicaid coverage from millions of Americans to pay for tax breaks for the rich.

Email press@groundworkcollaborative.org to speak with a Groundwork expert about President Trump’s economic mismanagement.

This week in the Trump Slump, new polling and economic indicators continue to show that President Trump’s policies are tanking the economy.

Economic indicators: 

• This week, the Federal Open Market Committee decided to keep interest rates steady, noting that “the risks of higher unemployment and higher inflation have risen.” Fed Chair Jerome Powell attributed the decision in part to uncertainty around Trump’s impulsive economic policy.

• The Bureau of Labor and Statistics reported that U.S. productivity has fallen for the first time since 2022.

Polling: 

• A survey from Small Business for America’s Future showed 80% of small business owners are pessimistic toward the economy, 77% are concerned about a recession, 68% believe President Trump has not met expectations in his first 100 days in office, and 80% say Trump’s tariffs pose a “severe or existential threat” to their business’ survival.

• Silver Bulletin found Trump’s overall job approval rating is plummeting, with his net approval dropping from +7.2 from his first week in office to -7.3. His approval on the economy (-13.5%) and trade (-17.7%) are tanking.

• Navigator Research found that a majority of Americans oppose Trump’s tariff policy, and two-thirds of Americans believe his tariffs are raising their costs.

• Data from Glassdoor’s employee confidence index shows plummeting business outlook and an 80% surge in uncertainty.

Expert Commentary: 

• Chief Economist for Moody’s Analytics Mark Zandi said of current prices for consumer goods, “Consumers should enjoy these lower prices, because they’re not here to stay. They’re going away pretty quickly, I think, over the next few weeks and months.”

• Brian Coulton, Chief Economist at Fitch Ratings, shared the following news that the Fed would hold interest rates steady: “The tariff shock will reduce real GDP growth and raise prices at the same time, putting the Fed on the horns of a dilemma. The policy move necessary to maintain full employment is the opposite of that necessary to contain inflation. Moving one policy lever to hit two conflicting targets is problematic.”

• George Eckerd, Research Director at JP Morgan Chase Institute, spoke to Fast Company about when younger generations will feel the pain of a slowing economy: “Everyone’s scrambling to find evidence of economic impact right now. But these things take time to evolve, and the data’s going to be much slower to come in than the rhetoric. Things are going to be fairly inertial for the time being.”

• Gene Seroka, Executive Director of the Port of Los Angeles, warned that shipping volume is down 35%, resulting in “fewer job opportunities for dock workers, truckers, and warehouse” workers. He also said that retailers big and small are reporting they have five or six weeks left of inventory, resulting in shortages and likely price increases for consumers.

• Groundwork Collaborative Executive Director Lindsay Owens published an op-ed in Rolling Stone where she called Trump’s tariffs “an assault on new parents.” Owens wrote, “If Trump were serious about supporting families, he wouldn’t be taxing babies or children. He’d fight for affordable childcare and paid family leave — and he’d restart inspections of milk and dairy at the Food and Drug Administration. Instead, he’s making it harder to afford the very basics, at the very start of a newborn’s life, when parents are most vulnerable — physically, emotionally, and financially.”

• Groundwork’s Managing Director of Policy & Advocacy Liz Pancotti joined Bloomberg Balance of Power to break down the Fed’s economic messaging: “…Since the last FOMC meeting, we saw them go up to the line of hinting at stagflation, slow growth, increasing unemployment and prices, and nothing since six weeks ago has gotten better. We’ve gotten new data showing really slowed growth… Certainly, we are seeing signs of a slowing labor market.”

• Groundwork Collaborative Chief of Policy and Advocacy Alex Jacquez spoke to USA Today about Trump’s proposed tariffs on foreign-made movies, saying, “This is nonsensical. It’s a waste of time. It’s not serious policy.”