“We have no inflation,” President Donald Trump stated during interview on Sunday evening. “Our groceries have decreased.” With those two erroneous assertions, Trump is echoing a political misstep that plagued his predecessor, former President Joe Biden, and played a role in the Democrats’ loss of the White House: Trump seems to be disregarding the economic realities that individuals are facing in their daily lives. The extent to which Trump may be engaging in a comparable political miscalculation is yet to be determined. The elections taking place today in Virginia, New Jersey, and New York City may provide valuable insights. Inflation is not currently at the crisis levels observed during the Biden administration; however, it has not dissipated entirely. Inflation is experiencing a resurgence, climbing in September to the highest annual rate observed since January, partially attributed to the president’s tariffs. Grocery prices have not decreased; rather, they have increased across all significant product categories, with a rise of 1.4% since the beginning of Trump’s administration, as per reports. It is challenging to persuade Americans to overlook the current economic conditions, particularly as many express dissatisfaction, largely due to the noticeable increase in prices encountered during their shopping experiences. A recent poll indicates that 72% of Americans perceive the economy as being in poor condition, while 47% identify the economy and cost of living as the foremost issue confronting the nation. Biden’s approval ratings regarding the economy have been notably low. In June 2022, amidst a backdrop where millions of Americans faced unprecedented gas prices and inflation reached a four-decade peak, Biden emphasized robust gross domestic product growth. “Observe the current situation.” Biden asserted, “We have the fastest growing economy in the world,” during an appearance on ABC’s “Jimmy Kimmel Live!,” a statement that classified as false. Biden acknowledged that inflation is “the bane of our existence,” yet minimized its impact by stating it’s “mostly in food, and in gasoline.”
The dismissiveness likely contributed to the Democrats’ electoral losses, as affordability emerged as the primary concern for Americans in 2024. Despite a decline in inflation, prices continued to increase—albeit at a slower pace and from elevated levels that remain concerning. Voters did not appear to be influenced by the Biden administration’s repeated assertions that the economy was thriving. “Wages continue to rise. Inflation continues to decline. Inflation has decreased from 9% to 3% — the lowest globally and continuing to trend downward,” Biden accurately stated during his 2024 State of the Union address. “It requires a period of adjustment, yet the American populace is starting to experience it.” Consumer studies indicate that consumer confidence is on the rise. Voters were not convinced. Biden’s speech overlooked the aggregate impact of escalating prices that constituents were experiencing. Trump’s strategies differ significantly from those of Biden. In 2023 and 2024, Biden accurately asserted that the pace of price increases was decelerating. Biden’s acknowledgment of elevated prices often included an attempt to attribute responsibility to corporations, criticizing phenomena such as “greedflation” and “shrinkflation.” Trump is unequivocally disseminating falsehoods while attributing blame to Biden.
Regardless of the approach taken, the outcome could ultimately remain unchanged. Americans exhibit a strong aversion to politicians who disregard the tangible realities faced by voters, particularly when confronted with escalating prices during routine supermarket visits. Trump astutely pinpointed Biden’s shortcoming, as he and his campaign consistently lambasted the former president for not adequately recognizing the distress that inflation had caused for Americans. During campaign appearances, Trump occasionally posed with groceries, remarking on their rising unaffordability. The consequence of assuming the presidency, naturally, is that the inherited issues swiftly transitioned into Trump’s responsibility. However, attributing blame to Biden or dismissing the facts does not appear to be yielding positive results. Trump is beginning to bear a significant portion of the responsibility for the negative economic sentiment: Approximately 61% of respondents indicate that they believe Trump’s policies have negatively impacted economic conditions in the United States, as per reports. Americans are not merely complaining about elevated prices; they are (not) aligning their financial actions with their sentiments, and they are altering their consumption patterns.
During recent earnings calls with analysts, Chipotle, Coke, Crocs, and various other consumer brands reported that middle-class and lower-income customers are tightening their spending. Despite a seemingly strong economy, the tepid pace of hiring is contributing to the anxiety among Americans, compounded by the diminishing federal safety-net benefits. Loan defaults and delinquencies are increasing once more among certain segments of America’s most at-risk populations. The issue with inflation lies in its cumulative nature. The cumulative impact of years of price increases is significant, even if the current rate of inflation is less pronounced than what was observed during the Biden administration in the aftermath of the pandemic. The average American household is incurring an additional $208 each month to purchase the same goods and services compared to September 2024, as indicated by data from latest inflation report. In September 2024, Trump was actively campaigning, asserting that inflation was spiraling out of control. Moody’s analysis reveals that, as a consequence of inflation, the average household is incurring an additional expenditure of $1,043 per month compared to the beginning of 2021. In essence, to acquire the equivalent quantity of goods that Americans obtained four years prior, they must allocate an additional $1,000 from their earnings.
Last week, Federal Reserve Chair Jerome Powell articulated the reasons behind the indifference of Americans towards metrics often highlighted by politicians, such as robust consumer spending or significant increases in gross domestic product. “Consumers are not interested in that story,” Powell stated during a media briefing on Wednesday. “Their prices are elevated. The primary source of their dissatisfaction with inflation stems from the inflation experienced in 2021, 2022, and 2023. One might argue that price increases are not as pronounced, yet this does not negate the fact that individuals continue to experience the effects of elevated prices stemming from the inflation observed two or three years prior. They are, and that is why a significant portion of the public, when surveyed, indicates that inflation continues to be a source of considerable dissatisfaction. Powell emphasized that a significant duration is required, along with increasing wages, for the impact of elevated prices to dissipate. “It will feel better over time, but that will take time,” he stated. In the interim, the insight for Trump might have been most effectively articulated by Democratic political strategist David Plouffe. In “Original Sin,” Jake Tapper and Alex Thompson regarding Biden’s late-term cognitive decline, Plouffe indicated that the critical error made by Democrats was to dismiss the reality that voters were observing. “Never again can we as a party suggest to people that what they’re seeing is not true,” he stated.