As Warning Signs Flash Across the Economy, Trump Administration Targets Key Statistical Agencies

Instead of Dealing with the Weakening Economy, Administration Officials Are Making it Harder to Get Accurate Economic Data

As recession indicators mount, the Trump Administration fired key advisors to the Department of Labor’s statistical agency this week. Instead of addressing his weakening economy, President Trump is making it harder to get accurate economic data. Groundwork Collaborative Executive Director Lindsay Owens reacted with the following statement:

“The Trump Administration is testing whether you can prevent a recession with a disappearing act. Unfortunately tossing a scarf over the GDP numbers doesn’t change the fact that their policies have us careening toward a downturn. The fact that they are ramping up their obfuscation tactics confirms it.”

At the same time, for the third week in a row, Trump Administration officials are admitting that a recession might be on the horizon, with Treasury Secretary Scott Bessent saying, “there are no guarantees.” Instead of addressing this coming economic disaster, however, Commerce Secretary Howard Lutnick is trying to inflate Tesla’s stock prices.

The Federal Reserve projected this week that Trump’s chaos will lead to higher unemployment, faster inflation, and slower growth – all the ingredients for stagflation. A fresh array of polling and economic indicators continue to show that the Trump economy is heading for disaster.

Economic Indicators:

• The Fed predicts 1.7% GDP growth this year, down from 2.1% previously projected in December. Officials also expect the unemployment rate to rise to 4.4% and inflation to edge up to 2.7% by year’s end, indicating a quickly-deteriorating economy under Trump’s mismanagement.
• Retail sales only rose 0.2% last month, falling short of expectations. Retail sales for bars and restaurants are falling – posting the largest decline since February 2023, indicating that consumers are pulling back from non-essential spending.
• Trump’s promised manufacturing boom hasn’t just failed to materialize – the sector as a whole is weakening. Factory activity as measured by the New York Fed’s Manufacturing Index had its largest decline in nearly two years. The Philadelphia Fed’s Manufacturing Survey showed that manufacturers in the region are now expecting less business and higher prices; the 6-month outlook had its third-largest decline ever.

Polling

• 67% of people surveyed by Global Strategy Group believe that it’s “likely” or “somewhat likely” that the U.S. economy enters a recession in the next year.
• Polling from NBC News found that just 18% of respondents rate the economy as “excellent,” or “good.”
• In a Harris poll, 72% of Americans are worried about President Trump’s tariffs – and 66% worry that it will take years to recover from the impact of Trump’s tariffs.
• In a Fox News poll, 79% of voters rated the economy only fair or poor, up from 77% in December 2024. In the same poll, 43% of voters approved of Trump’s handling of the economy, with 56% disapproving, and just 40% of voters approved of Trump’s handling of inflation, with 58% disapproving.

Expert Commentary

• Federal Reserve Chair Jerome Powell emphasized the uncertainty that’s gripping the economy in his remarks, saying, “In the current situation, uncertainty is remarkably high” and “It’s really hard to know how this is going to work out.” A Goldman Sachs analyst called the Fed’s projections “stagflationary.”
• In an interview with New York Magazine, Mark Zandi, chief economist at Moody’s Analytics, said of potential economic weakening: “This is all self-inflicted. Again, the economy had its issues. There are always issues. But coming into the year, it was performing exceptionally well. It was far and away the strongest economy on the planet.”
• Wall Street fund managers, strategists, and analysts surveyed by CNBC raised their recession risk to the highest level in 6 months – 36%, up from 23%. Barry Knapp of Ironsides Macroeconomics said, “Consequently, the economic risks of something more insidious than a soft patch are growing.” Neil Dutta of Renaissance Macro Research said, “There is meaningful downside to current estimates of 2025 GDP.”
• Following the release of the Fed’s projections on Wednesday, Groundwork Collaborative’s Chief of Policy and Advocacy Alex Jacquez raised the alarm on the coming stagflation: “Voters elected President Trump to lower the cost of living, and instead, they continue to be saddled with persistently high inflation and interest rates. Launching chaotic trade wars with our allies and gutting Social Security, Medicaid, and other vital programs in order to fund tax breaks for his billionaire donors isn’t making life more affordable for working-class families. It is, however, a perfect recipe for stagflation.”

Amid the economic chaos, President Trump illegally fired two Democratic commissioners on the Federal Trade Commission (FTC), including Alvaro Bedoya, who recently sent a letter to FTC Chair Andrew Ferguson urging him to take 10 specific actions to lower prices. Instead of taking action, Trump fired him – proving once again that he has no intention to lower prices for working families.

Email press@groundworkcollaborative.org to speak with a Groundwork expert about President Trump’s handling of the economy.