Trump’s portrayal of a “Gilded Age” does not match the way Americans view the economy

WASHINGTON (AP) — In his first State of the Union address, President Donald Trump sought to sell Americans on the idea of ​​a booming economy, low prices and rising jobs, but he faces a skeptical public with a bleaker view.

In fact, just 12 hours before his speech, the Conference Board, a business research group, released its latest report on consumer confidence. It showed that overall confidence in the economy remains historically low, barely above the level it reached in the depths of the coronavirus recession.

In February, its index rose to 91.2, significantly lower than the four-year peak reached in November 2024 of 112.8. The survey found that Americans are still frustrated with rising prices and believe that there are few available jobs.

Read more: Fact-checking Trump’s State of the Union claims on the economy, immigration and crime

Other polls have produced similar results: Only 39% of Americans approve of Trump’s economic leadership, according to the latest poll by The Associated Press-NORC Center for Public Affairs Research. The University of Michigan consumer survey remains mired in recessionary levels.

Trump has sought to overcome this gloom by pointing to economic data that paints a brighter picture, a tactic that President Joe Biden has tried with little success. But Tuesday night there were gaps between the president’s claims and the economic reality facing many Americans.

“Inflation is falling, incomes are rising rapidly, and the booming economy is booming like never before,” Trump said.

The economy grew last year, but at a slower pace

At first, the economy is growing but it is barely “booming.”

It expanded 2.2% last year, down from 2.8% last year for Biden and 2.9% in 2023. To be sure, most Americans have been deeply unhappy with price hikes under Biden that have pushed inflation to a peak of 9.1% in 2022, the highest level in four decades.

The typically booming U.S. economy looks more like the late 1990s, when growth topped 4% for four straight years, or the 1980s, when it rose 3.5% or higher for six straight years.

Consumers are still suffering from high prices

Inflation slowed last year, but many Americans still cite rising prices in surveys as a main reason for their dissatisfaction with the economy.

Trump rightly noted that core inflation, which excludes volatile food and energy categories, fell to a five-year low in January. However, other price measures show that inflation remains stubbornly high: The Fed’s closely watched measure of core prices was 3% higher in December than a year earlier, above the Fed’s 2% target. It places less weight on housing costs, which have fallen, than the measure mentioned by Trump.

Nearly half of people who responded to the University of Michigan’s consumer confidence survey in February “casually stated that higher prices are eroding their personal finances,” Joan Hsu, the survey’s director, said in a statement.

Trump noted that the price of eggs has fallen sharply from its peak, which is true, but most of the necessities Americans depend on — groceries, rent, electricity — are still much more expensive than they were five years ago. Electricity prices have risen by another 6.3% in just the past 12 months.

Trump’s tariffs have also raised the cost of many imported items, including furniture, auto parts, tools and clothing. Prices of groceries such as ground beef, coffee and bananas have risen sharply in the past year. For example, ground beef prices rose 17%.

Land leasing nearly stopped last year

One reason for the consumer gloom is likely the sharp slowdown in hiring last year. Employers added just 181,000 jobs in 2025 — or 15,000 jobs per month — making it the worst year for job growth outside of a recession since 2002.

Despite Trump’s pledge to revive American manufacturing, factories lost 108,000 jobs in 2025, on top of the 202,000 jobs lost in the last two years of the Biden administration. Automobile and auto parts factories have cut nearly 74,000 jobs over the past two years.

Trump’s tariffs are partly to blame because they force many factories to pay more for imported raw materials and parts. But high interest rates have also hurt manufacturers over the past two years. Many of them hired aggressively — perhaps too much — in 2021 and 2022 when the U.S. economy was recovering from pandemic shutdowns. Automation also means that many factories need fewer workers.

Hiring came in unexpectedly strong in January at 130,000 new jobs, and factories added jobs for the first month in more than a year.

The benefits of tariffs are still unclear

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Trump noted that his tariffs directly contributed to America’s economic prosperity, but most Americans likely saw little benefit.

“Going forward, factories, jobs, investments, and trillions and trillions of dollars will continue to flow into the United States of America,” Trump said.

Once again, Trump made his tariffs seem painless, insisting that they were paid by foreign countries. In reality, they are paid by American importers who often try to pass the burden on to their customers through higher prices. Foreign companies may be harmed if they are forced to lower prices to maintain sales in the United States. But import prices have not fallen significantly, suggesting that exporters abroad are not feeling much pain.

A study by Harvard economist Alberto Cavallo and his colleagues found that American consumers were eating 43% of the costs of higher tariffs and that American companies were absorbing most of the rest.

So far, Trump’s sweeping import taxes have made little progress toward his goal of reducing America’s huge long-term trade deficit — the gap between what America sells to foreign countries and what it buys from them.

The US trade deficit in goods such as cars and appliances – the focus of Trump’s protectionist policies – reached a record $1.24 trillion last year, up 2% from 2024.