The US economy is delivering strong headline figures, but President Donald Trump has not won over voters with his claims that the country has entered a “golden age.” Growth accelerated to an annualized 3.4% in the third quarter, unemployment was 4.2%, and core inflation stood at 2.5% by the consumer price index and 3% by the personal consumption expenditures index.
Other indicators also point to economic strength. Energy prices are lower than in most other wealthy countries, businesses are investing heavily in infrastructure for artificial intelligence, and foreign companies including Audi have announced plans to build factories in the United States. Federal Reserve data cited in the report show household net worth rising across every income group since 2019, including by about 80% for the lowest fifth.
Yet voters are giving Trump poor marks on the economy ahead of the midterm elections. A recent NBC poll found that 53% of Republicans were dissatisfied with economic conditions. In an average of recent polls compiled by election analyst Nate Silver, 25.3% of voters approved of Trump’s handling of inflation, while 69.5% disapproved.
The report notes that voters tend to judge prices against their own recent experience rather than compare the US with other industrialized economies. Since the start of the Iran war, inflation has risen from 2.4% to 3.7%. Gasoline prices have climbed from $2.99 to $4.18 a gallon, while diesel has gone from $4.25 to $6.31. Real wages, which had been growing by 1.2% a year, are now falling by 0.7%.
Housing has also become less affordable for many households. Rates on standard 30-year mortgages rose from 6% to 7.3%, while the personal saving rate fell from 5.3% to 3.8% of disposable income. The article says households are drawing more heavily on their finances to maintain spending, supporting the broader economy while adding to consumers’ unease.
Trump campaigned on ending inflation, and the current rate remains above the 2.9% recorded in the final month of Joe Biden’s presidency, according to the report. Alongside the Iran war, Trump’s tariffs are cited as a factor in higher prices. Yale University’s Budget Lab estimates the tariffs cost the average household at least $1,100 a year.
Corruption has also become an issue for voters. The report points to the Trump family’s growing wealth and business dealings involving people in the president’s circle, which have contributed to perceptions that the government is for sale. A Navigator Research poll found that 60% of voters believe Trump has increased corruption in Washington.
Trump’s alliance with technology billionaires may pose another political risk. In a July YouGov poll, 71% of Americans said major technology companies and their leaders had too much power. Data centers, which companies need for AI development and the administration sees as an economic driver, have become contentious in many districts over concerns about energy and water costs, construction noise and artificial intelligence.
Sources: FAZ.