The Trump administration’s economic policies have been a point of contention, with many Americans feeling the pinch of rising costs and stagnant wages. Despite President Donald Trump’s assertions on social media that the economy is thriving, many indicators suggest otherwise. The Democrats, aiming to present themselves as a more reliable alternative, are proposing a series of measures to address these economic challenges.
President Trump recently claimed that the economy is “BOOMING” and that costs, including grocery prices, are decreasing. However, this narrative is contradicted by the lack of official government statistics, which have not been released due to the government shutdown. This absence of data seems to offer a reprieve for the administration, as reports on jobs and the Consumer Price Index remain unpublished.
Rising Prices and Falling Real Wages
One of the most pressing issues is the continued rise in consumer prices, which have increased by 27% since the pandemic’s onset. Real wages, however, have not kept pace. A recent Harris poll indicates that 62% of Americans have noticed a rise in the cost of everyday items, with nearly half finding these increases difficult to afford.
The imposition of tariffs by the Trump administration has contributed significantly to these rising costs. These tariffs, essentially import taxes, are passed on to consumers by American corporations. While some tariffs on agricultural commodities have been lifted, many remain, affecting a wide range of goods. Consequently, inflation-adjusted wages have been declining, with lower- and middle-income households particularly affected, as noted by the Bank of America Institute.
Stalled Job Growth
Job growth has also hit a snag, with many Americans fearing job loss. The same Harris poll reveals that 55% of employed workers are concerned about layoffs. Data supports these fears, with Indeed’s job posting index dropping to its lowest since February 2021. The Federal Reserve’s Beige Book and ADP’s private-sector data corroborate the weakening labor market, with significant job losses reported.
Challenger, Gray & Christmas reports that US employers have announced 1.1 million layoffs in 2025, the highest since the pandemic’s economic impact in 2020. This level of job cuts is comparable to those during the Great Recession of 2008 and 2009.
Homeowners and Corporate Profits
The housing market is another area of concern, with nearly 900,000 homeowners underwater on their mortgages, the highest in three years. Foreclosure filings have also risen by 17% since the previous year, indicating financial distress among borrowers.
In contrast, corporate profits continue to soar, with the stock market hitting new highs. The richest 10% of Americans, who own the majority of the stock market, are benefiting significantly. This disparity is partly due to corporations’ reluctance to expand amidst uncertainty and the monopolistic power of major tech firms, which allows them to raise prices.
Additionally, the rise of artificial intelligence is boosting productivity but reducing the demand for workers, particularly in the tech sector. This trend is spreading across industries, further exacerbating the employment issue.
Widening Economic Inequality
The culmination of these factors is a widening economic inequality gap. The middle class, traditionally part of the upper economic tier, is now joining the lower tier, creating a two-tier economy. The investor class, representing the wealthiest 10% of households, now accounts for nearly half of total US spending, up from a third thirty years ago.
This economic divergence is concerning, as the economy’s reliance on a small, wealthy group makes it more vulnerable to downturns. A significant stock market decline could trigger a serious recession.
Democratic Proposals for Economic Reform
In response to these challenges, Democrats are proposing a comprehensive plan to address economic disparities and improve living conditions for average Americans. Their pledges include:
- Eliminating tariffs where consumer costs outweigh potential job benefits.
- Enforcing antitrust laws to dismantle monopolies, particularly in tech, healthcare, food, and finance.
- Strengthening unions to enhance workers’ bargaining power for higher wages.
- Raising the national minimum wage to $20 an hour.
- Restricting private equity firms from manipulating housing markets.
- Expanding Medicare to lower healthcare costs.
- Providing support for childcare and eldercare.
- Introducing paid family leave.
- Implementing a universal basic income to prevent poverty.
- Increasing taxes on the wealthiest to fund these initiatives.
As the economic landscape continues to evolve, the effectiveness of these proposals will be closely scrutinized. The Democrats’ ability to implement these changes could significantly influence their political fortunes and the broader economic recovery.
Republished from Common Dreams, 17 November 2025. The views expressed in this article may or may not reflect those of Pearls and Irritations.
