Trump proves leftist critics wrong as economy soars under tariffs and tax cuts

OPINION:

“Americans fear an imminent recession,” a CNN headline read on April 2, concluding, “That may be enough to put us in one.”

“Uncertainty over Trump’s tariffs paralyzes U.S. businesses,” The New York Times warned on April 25. “Businesses are rushing to cancel factory orders or halt shipping containers before they leave China, unable to afford the tariff when the ships arrive in America. They are pausing capital investments and new hiring, and scaling back spending to only the bare necessities. Future products are being scrapped because they are no longer financially viable.”

“U.S. markets suffered their steepest declines since 2020 on fears President Trump’s new tariff plans will trigger a global trade war and drag the U.S. economy into recession,” The Wall Street Journal also reported in April. Its editorial board wrote every other day about Mr. Trump’s tariff strategy being one of the “dumbest” in history.

Mr. Trump has now been in office for six months, and none of these predictions has come to fruition. In fact, the opposite is true: The U.S. economy is firing on all cylinders, with U.S. consumer sentiment rising to a five-month high in early July.

By his Fourth of July deadline, Mr. Trump signed into law his One Big Beautiful Bill Act, which extends the 2017 tax cuts, allows seniors to deduct up to $6,000 from their taxable incomes and includes no taxes on tips or overtime. U.S. tariff revenue surged to $108 billion on a net basis, nearly double the prior-year collections. The Treasury Department produced a surprise $27 billion surplus in June, all with no inflation.

Last week, Congress passed its first rescission package in 25 years, clawing back $9 billion in wasteful spending.

Under Mr. Trump’s directive to “drill, baby, drill,” the U.S. has reached its fastest rate of new oil and gas drilling permits in years, exceeding the Biden administration by 44%. Summer gas prices have reached their lowest point since 2021.

Adjusted for inflation, gas prices are near a 20-year low. And those darned egg prices? A dozen averages $3.09, down 62% from its March peak.

Real wages for hourly workers have increased 1.7%, the highest under any administration in nearly 60 years, compared with the negative wage growth during the first five months of the Biden administration.

The only other time blue-collar workers have had such an increase was during Mr. Trump’s first term.

That increase is mainly for American-born workers. Since January, foreign-born workers have lost 543,000 jobs, while American citizens have gained 2 million, as Mr. Trump focuses on reshoring manufacturing in America, attracting $3 trillion in new corporate investments.

The sky is not falling. Mr. Trump’s focus on economic growth through tax cuts, deregulation, energy dominance and, yes, his tariff policy, is producing economic prosperity despite the naysayers in the media.

On Monday, even The Wall Street Journal, one of the toughest critics of the president’s tariff strategy, acknowledged that “the U.S. economy is regaining its swagger,” with evidence mounting that “companies and consumers who held back during the spring’s tariff chill are starting to surge again.”

As for the pesky economists who predicted doomsday in April, they dialed back their pessimism in July. The latest forecasts in the quarterly Wall Street Journal survey show “a reduced chance of recession and stronger gross domestic product growth in the second quarter.”

Now, it’s up to the Federal Reserve and Chair Jerome Powell to unleash the housing market, which has remained stagnant under Mr. Trump’s presidency because of stubbornly high mortgage rates.

Mr. Powell has sharply criticized Mr. Trump’s tariff policies and has refused to lower interest rates out of a fear of inflation. However, that inflation hasn’t materialized, and Mr. Powell could raise the rates if it does.

In a Friday post on Truth Social, Mr. Trump once again focused his ire on the Federal Reserve’s chairman, whom he has dubbed “too late” because of his refusal to lower rates.

Mr. Trump said higher interest rates are “making it difficult for people, especially the young, to buy a house,” and he called Mr. Powell “truly one of my worst appointments.”

“Sleepy Joe saw how bad he was and reappointed him anyway – and the Fed Board has done nothing to stop this ‘numbskull’ from hurting so many people,” Mr. Trump said in his post. “In many ways the Board is equally to blame! The USA is Rockin’, there is VERY LOW INFLATION, and we deserve to be at 1%, saving One Trillion Dollars a year on Interest Costs. I can’t tell you. How dumb Too Late is – So bad for our Country.”

The Federal Reserve will meet next week to discuss monetary policy. It is not expected to lower rates, likely very much to Mr. Trump’s chagrin.

• Kelly Sadler is the commentary editor at The Washington Times.