Democrats were swept out of power last year as they suffered political pain from rising costs. Now, President Donald Trump is overseeing stubborn inflation, a slowing job market and anxiety over his tariffs, and Democrats are determined to make his party pay the price.<\/p>\n
With the 2026 midterm cycle on the horizon, the economy is shaping up to once again play a dominant role. Democrats are keenly aware that what sunk them last time could be their ticket back to power.<\/p>\n
Trump\u2019s own daring promise is complicating the situation for his party after he told voters in 2024<\/a>, \u201cWhen I win, I will immediately bring prices down, starting on Day 1.\u201d<\/p>\n That\u2019s a message Democrats will be emphasizing.<\/p>\n \u201cHe\u2019s promised us this golden age. It\u2019s not happening,\u201d said Rep. Don Beyer, D-Va., a member of the U.S. Congress Joint Economic Committee. \u201cHe promised the renewal of all his manufacturing jobs \u2014 not happening. Promised tariffs could restore all this stuff \u2014 not happening at all.\u201d<\/p>\n Economic anxiety is high. The August jobs report showed 22,000 new jobs<\/a> \u2014 a paltry total compared to recent years. Prices on a variety of goods and services rose more than expected<\/a> in August, with year-over-year inflation growing to 2.9%, the highest rate since January.<\/p>\n The cost of household staples like coffee and beef are soaring<\/a> even as the rise in food prices has slowed from the decades-high inflation seen in 2022. Overall, grocery prices were up 2.7% in August compared to a year earlier, the biggest increase in two years. Electricity costs<\/a> are rising<\/a>, too, driven in part by the growth<\/a> of AI data centers<\/a>. The August NBC News Decision Desk poll<\/a> found that 45% of voters said rising costs are their top economic concern.<\/p>\n Trump has sought to reshape much of the economy, with sweeping tariffs, large tax cuts and pressure on the Federal Reserve and private companies. There are economic bright spots Trump and his allies have promoted: The stock market has seen substantial gains<\/a>, in part because of the AI boom<\/a> that Trump\u2019s administration has sought to bolster. U.S. gross domestic product grew at a 3.8% annual pace<\/a> between April and June after shrinking earlier this year, the Department of Commerce said in its second upward revision<\/a> on Thursday.<\/p>\n The White House argued that the economy is in better shape than other measures indicate, pointing to wage increases<\/a>, a lower rate of inflation than in Biden\u2019s term<\/a>, a job market they say favors native-born workers, and surging stock, among other measures. The economy, some allies say, can’t turn on a dime.<\/p>\n \u201cJoe Biden\u2019s reckless policies destroyed the economy, but President Trump is fixing it in record time to usher in the Golden Age of America \u2014 inflation has cooled, wages are on the rise, real consumer spending rose in July, manufacturing jobs are being reshored, and over half a million good-paying jobs have been created in the private sector,\u201d White House spokesperson Taylor Rogers said, adding that Americans \u201cwill continue to feel economic relief in the months ahead as \u2026 massive tax cuts, deregulation, and energy dominance continue to materialize.\u201d<\/p>\n Yet his opponents say that the president is now trying to shift attention away from the topic. At a White House event on Monday about autism, Trump discouraged reporters from talking about the economy.<\/p>\n \u201cLet\u2019s just make it on this subject,\u201d Trump said, referring to the autism announcement<\/a>. \u201cI\u2019d rather not talk about some nonsense on the economy. I will say this: The economy is unbelievable.\u201d<\/p>\n The headwinds have cut into what was long one of Trump\u2019s advantages: Voters trusted him to strengthen the economy. It was a dynamic that helped boost his campaign with voters who were angry with price increases under President Joe Biden and wanted a return to Trump\u2019s pre-Covid economy.<\/p>\n Recent polls show voters have soured on Trump\u2019s handling of the economy. A Fox News poll<\/a> this month found that 52% of voters believe the administration has made the economy worse \u2014 the same number who said in January the Biden administration was doing so. Trump\u2019s performance on cost of living was his worst issue, with 67% of voters disapproving. What\u2019s more, 63% disapprove of his handling of tariffs, and 60% of his economic efforts.<\/p>\n Now, Democrats are seeking to unify around an economic message they think can bring together their fractured party. Republicans, though, expressed confidence that once their \u201cbig, beautiful bill\u201d<\/a> starts to sink in, and as uncertainty around tariffs dies down, economic sentiment will turn in their favor.<\/p>\n Michigan state Sen. Mallory McMorrow, a Democratic Senate candidate, said she\u2019s hearing economic concerns \u201call over the state right now.\u201d<\/p>\n \u201cI\u2019m hearing this most acutely with young people, people who might have recently graduated from college, have degrees, who just cannot find a job right now, and [are] certainly feeling the tightening economy, but also the impacts of AI,\u201d McMorrow said, adding that she is telling people: \u201cThis is not a global pandemic that we\u2019re in right now. This is also not a recession like we saw in 2007-09. The inflation that we are seeing right now is entirely man-made, and it\u2019s caused by Donald Trump.\u201d<\/p>\n There are other potential problems for Republicans.<\/p>\n Consumer spending is holding steady<\/a> but is being driven<\/a> by the top 10% of earners. Young men \u2014 a population that played a huge role in Trump\u2019s victory \u2014 have been hit hard in the slowing job market.<\/a> Labor Department data<\/a> showed initial jobless claims for the week ending Sept. 6 jumped by 263,000 \u2014 the most since October 2021 \u2014 though initial jobless claims fell to 218,000 for the week<\/a> ending Sept. 20.<\/p>\n Americans\u2019 view of capitalism is falling too. A Gallup survey this month showed 54% of Americans hold a positive view of the economic system, the lowest level the poll has recorded<\/a>.<\/p>\n \u201cThere is a big cohort of people who voted for Donald Trump because they really, sincerely believed that he was going to bring down the price of their daily necessities,\u201d Sen. Brian Schatz, D-Hawaii, said. \u201cAnd almost everything is significantly more expensive.\u201d<\/p>\n Sen. Cynthia Lummis, R-Wyo., said it\u2019s too early to grade Republicans\u2019 performance on lowering costs because \u201cthe economy doesn\u2019t move on a dime.\u201d But she acknowledged that they need to make tangible progress by the 2026 midterms.<\/p>\n \u201cThe problem right now is the people who are doing well, the people who are consuming the most, are the very wealthy,\u201d Lummis said. \u201cIt is the middle class and lower middle class that is not buying because their salaries aren\u2019t keeping up with inflation or interest rates are too high to buy a home. They\u2019re treading water, and so we have to focus on the middle class in order to alleviate concerns about a bad outcome in the 2026 elections.\u201d<\/p>\n The White House has also highlighted a major revision this month<\/a> from the Bureau of Labor Statistics showing job growth was much slower than originally reported between April 2024 and March 2025, saying it shows slower job growth dates back to Biden. Trump fired the head of the BLS \u2014 and nominated a MAGA ally in her place<\/a> \u2014 after a particularly weak July jobs report.<\/p>\n There has been a steep decline<\/a> in the immigrant workforce under Trump\u2019s aggressive deportation agenda. Vice President JD Vance<\/a> and other conservatives<\/a> have said the exodus of foreign-born workers can explain the weaker job growth, but that it creates more employment opportunities for native-born Americans. The Economic Policy Institute, a left-leaning think tank, argued<\/a> Trump\u2019s job market has been worse for U.S.-born workers, pointing to BLS data showing an increased unemployment rate among this group.<\/p>\n Jared Bernstein, chair of the Council of Economic Advisers under Biden, said he sees the economy \u201cslowing in ways that are concerning\u201d and warned of the potential for stagflation<\/a>.<\/p>\n \u201cEmployers and businesses are in a bit of a hiring freeze and investment freeze,\u201d Bernstein said. \u201cThey\u2019re sitting on their hands, waiting and seeing what\u2019s going to come of the trade war, the deportations, the chaos, the Federal Reserve badgering, the DOGE cuts. It\u2019s all unsettling for businesses who like a much calmer environment as a backdrop.\u201d<\/p>\n In a move Trump long pushed for, the Federal Reserve last week cut interest rates by 0.2 percentage points<\/a>. In his news conference after lowering interest rates, Fed Chair Jerome Powell tied the cut directly to issues in the labor market.<\/p>\n \u201cYou see people who are sort of more at the margins, and younger people, minorities are having a hard time finding jobs,\u201d Powell said.<\/p>\n He added that the economy is being bolstered by \u201cunusually large amounts of economic activity through the AI build-out and corporate investment.\u201d And he said that while consumer spending numbers exceeded expectations, they appear skewed toward high earners.<\/p>\n \u201cSo it\u2019s not a bad economy or anything like that,\u201d Powell said, adding: \u201cBut from a policy standpoint \u2026 of what we\u2019re trying to accomplish, it\u2019s challenging to know what to do.\u201d<\/p>\n Much of the existing economic uncertainty has centered on the president\u2019s tariff agenda. The dust appears to be more settled now: Some tariffs have been lowered, new trade agreements have been reached with key partners, and a number of categories, including some electronics, have been exempted.<\/p>\n A White House official said uncertainty on passage of the \u201cbig, beautiful bill\u201d and on tariffs has \u201clargely been resolved.\u201d<\/p>\n \u201cYou can now plan around what the tariff rate is going to be,\u201d this person said. \u201cWe\u2019re not in flux anymore.\u201d<\/p>\n So far, Trump\u2019s vow to bring manufacturing jobs back to the U.S. has yet to materialize, with industry continuing to cut back on the number of workers. The U.S. lost 12,000 manufacturing jobs in August amid a wider slowdown in the labor market, according to BLS data<\/a>. The Trump administration has pointed to manufacturing investments, noting factories can\u2019t open overnight.<\/p>\n Trump\u2019s tariffs have weighed on<\/a> manufacturing companies now having to pay tariffs on steel and aluminum imports, along with imported machinery and parts. Companies have also continued to ramp up automation, requiring fewer workers to make the same amount of goods.<\/p>\n Federal Reserve data released Sept. 16 showed a mixed picture<\/a> for the manufacturing sector last month, with factory production ticking up in August after declining in July. The increase was driven by a rebound in auto production while other areas, like companies making machinery and metal products, saw declines.<\/p>\n Steve Moore, a senior economic adviser to Trump in his first term, believes the economy is in a good spot, pointing to similar data points as the White House. But he cautioned that \u201cat some point, some of these [tariff] costs are going to be passed down to consumers, no question about it,\u201d though he said the country could still see benefits down the road.<\/p>\n There is an economic uncertainty that has the president and his allies concerned: a case before the Supreme Court that could lead to his tariffs being overturned. Moore said the White House is \u201cvery keyed into\u201d the case.<\/p>\n \u201cI think it\u2019s going to be disruptive,\u201d Moore said if the court overturns the tariffs. \u201cAnd I don\u2019t think anybody really knows what would happen. Will they have to return the money to the people who paid that? Will they pay the taxes? And what happens to trade deals? It would be havoc.\u201d<\/p>\n Democrats want to frame a straightforward economic argument for the midterm elections: Trump promised to lower prices immediately upon taking office, and yet costs are rising.<\/p>\n \u201cWhat we must do is not just compare this economy to Biden\u2019s,\u201d Beyer said, \u201cbut compare it to what Trump said he was going to do.\u201d<\/p>\n In a memo marking Trump\u2019s first six months in office, the Democratic National Committee mentioned lowering prices as the top promise Trump had broken upon taking office<\/a>. A memo this month from the Bipartisan Cost Coalition, an anti-Trump group launched by former aides to Biden and President George W. Bush, said 2026 candidates \u201ccan succeed in this environment by having the courage to challenge Trump\u2019s dishonest narratives and draw a line between chaos and the rising cost of living.\u201d<\/p>\n Sen. Mike Rounds, R-S.D., said GOP prospects in 2026 will turn on whether they can sell Trump\u2019s \u201cbig, beautiful bill\u201d and improve voters\u2019 confidence in their finances.<\/p>\n Republicans are eager to promote the bill\u2019s new tax cuts and credits, including tax breaks on overtime and tipped wages as well as expensing and deduction provisions<\/a> they believe will encourage new investment in the U.S. and grow the job market.<\/p>\n \u201cIt\u2019s going to depend on whether or not we can actually see the benefits and get the information on the benefits out about what the reconciliation package did,\u201d Rounds said.<\/p>\n So far, Trump himself has not taken to the trail to promote the landmark legislation, though Vice President JD Vance has been visiting key battlegrounds to do so.<\/p>\n The legislation\u2019s cuts to health insurance programs already threaten hundreds of thousands of jobs<\/a>. This month, a hospital chain in Virginia announced a consolidation it said is in part<\/a> necessitated by \u201cthe One Big Beautiful Bill Act and the resulting realities for healthcare delivery.\u201d<\/p>\n A Republican operative working on Senate races said Trump\u2019s legislative package will give business leaders certainty on taxes over the next few years. But this person was mindful of how the job market looks now, particularly for younger voters struggling to find entry-level jobs.<\/p>\n \u201cTrump realizes that you really need to gas this thing up to get people hiring and get confidence in the market,\u201d this person said. \u201cSo it\u2019s not an overnight switch that the president could flip to get people hiring young men into the economy.\u201d<\/p>\n A Washington Post-Ipsos poll conducted this month found that while just 40% of voters approved<\/a> of Trump\u2019s handling of the economy, Republicans still held a 7-point edge over Democrats<\/a> on which party voters trust more on the issue.<\/p>\n Pennsylvania\u2019s new Democratic Party Chairman Eugene DePasquale said he wants to get Keystone State Democrats to \u201cfocus like a laser\u201d on economic issues.<\/p>\n \u201cBut it\u2019s one thing to have people be upset about Trump,\u201d DePasquale said. \u201cIt\u2019s another thing for them to vote for us. \u2026 We\u2019ve also got to show we\u2019re listening and putting real ideas on the table to try to win him back.\u201d<\/p>\n Moore said Republicans will need \u201cto remind people of how bad things were under Biden\u201d while framing the president\u2019s signature legislation not as a tax cut but as a job creation bill.<\/p>\n \u201cLook, you can\u2019t fool people on the economy,\u201d Moore said. \u201cPeople know what\u2019s going on. They know what it costs to buy groceries. They know what jobs are available. When Biden was saying, \u2018Oh, [inflation is] transitory,\u2019 and so on, it didn\u2019t fool people. So these policies have to be shown to be working.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":" Democrats were swept out of power last year as they suffered political pain from rising costs. Now, President Donald Trump is overseeing stubborn inflation, a slowing job market and anxiety over his tariffs, and Democrats are determined to make his party pay the price. With the 2026 midterm cycle on the horizon, the economy is <\/p>\n","protected":false},"author":2,"featured_media":3285,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[],"class_list":{"0":"post-3284","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business"},"_links":{"self":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/posts\/3284","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/comments?post=3284"}],"version-history":[{"count":0,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/posts\/3284\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/media\/3285"}],"wp:attachment":[{"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/media?parent=3284"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/categories?post=3284"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/marketsfortress.com\/index.php\/wp-json\/wp\/v2\/tags?post=3284"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}