Trump is already preparing to blame Democrats for his souring economy


Publicly, President Trump is predicting that Republicans will maintain unified control of the federal government after next week's congressional elections, but he also tweeted Tuesday that the stock markets, now back to where they started 2018, are "taking a little pause" because "people want to see what happens with the midterms." This is part of Trump's new "simple strategy if markets and the economy cool over the next two years: Blame Democrats and the Fed," Politico reports. "In recent days, Trump and his senior advisers have repeatedly argued that recent turbulence in the stock market reflects investor fear that Democrats will retake the House in the midterm elections next week."
According to economists and market analysts, "these arguments bear little connection to reality," Politico says, explaining:
Instead, they note that the economy is following a pattern many predicted when Trump and Congress slashed corporate tax rates last year: A period of faster growth followed by a return to the pace of around 2 to 3 percent that has persisted for nearly a decade with annual deficits rising. Market analysts and traders also attribute much of the recent volatility in stock prices to fear over Trump's bitter trade war with China and concern that corporate profits have hit their high point for the current economic expansion, which is now in its 10th year and approaching the longest expansion on record. Panic over Democratic gains in Congress does not rank high on the list of worries. [Politico]
Stocks dropped sharply on Monday, for example, directly after a report that Trump could slap tariffs on just about all imports from China as soon as December. And underscoring the rising deficit, the Treasury Department said Tuesday that federal borrowing will rise to $1.34 trillion this year, more than double 2017's borrowing and the highest level since post-recession 2010. You can read more about what's really moving the markets at Politico.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.
-
Warren Buffet announces surprise retirement
speed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement
-
Trump calls Amazon's Bezos over tariff display
Speed Read The president was not happy with reports that Amazon would list the added cost from tariffs alongside product prices
-
Markets notch worst quarter in years as new tariffs loom
Speed Read The S&P 500 is on track for its worst month since 2022 as investors brace for Trump's tariffs
-
Tesla Cybertrucks recalled over dislodging panels
Speed Read Almost every Cybertruck in the US has been recalled over a stainless steel panel that could fall off
-
Crafting emporium Joann is going out of business
Speed Read The 82-year-old fabric and crafts store will be closing all 800 of its stores
-
Trump's China tariffs start after Canada, Mexico pauses
Speed Read The president paused his tariffs on America's closest neighbors after speaking to their leaders, but his import tax on Chinese goods has taken effect
-
Chinese AI chatbot's rise slams US tech stocks
Speed Read The sudden popularity of a new AI chatbot from Chinese startup DeepSeek has sent U.S. tech stocks tumbling
-
US port strike averted with tentative labor deal
Speed Read The strike could have shut down major ports from Texas to Maine