The narrative of a booming economy is central to Donald Trump’s 2020 reelection strategy, and a majority of Americans approve of how Trump has handled economic matters. But that narrative isn’t as rosy as it appears.
Americans are struggling to afford basic necessities. The government shutdown last winter exposed how many Americans face disaster after missing just one paycheck, and Trump’s tariffs threaten what tenuous growth the economy has shown.
Now, a new study has shown that 51% of working adults cannot financially handle missing a single paycheck without savings. Another new study shows 58% of Americans have less than $1,000 in savings. 40% of Americans lack a basic level of savings altogether.
“You hate to sound like a cliche, but are you better off than you were four years ago? It’s pretty simple, right? ‘It’s the economy, stupid.’ I think that’s easy,” said White House acting chief of staff Mick Mulvaney. “People will vote for somebody they don’t like if they think it’s good for them.”
And that’s without considering indications that an economic downturn is on the horizon, be they in bellwether statistics or warnings from financial institutions against elements of Trump’s economic policy.
“At this point, there’s more actual risk exposure than Trump would have you believe,” a senior Wall Street banker told Vanity Fair, “The world is more leveraged than it has ever been before at the corporate level, at the sovereign level, and collectively at the consumer level.”
Vanity Fair‘s William Cohen characterized this as a time bomb in the Trump economy, fueled by artificially low interest rates and risky financial instruments that reflect the run-up to the 2008 economic collapse. There also exists the looming threat of automation, which is poised to significantly disrupt the global economy in the next decade. All tolled, the economic headwinds seem to be ephemeral, and the rising tide doesn’t seem to be lifting all boats while it lasts.
Even the recent acceleration of wage growth has been concentrated among the already-wealthy, and successful efforts to raise the minimum wage still fall short of providing a living wage in many American cities.
“Short disruptions in pay can cause significant hardship, as most Americans appear to be living paycheck-to-paycheck,” said Angela Fontes, director of the Behavioral and Economic Analysis and Decision-Making program at the University of Chicago.
The last major economic disaster came with quite a few disruptions in pay. It doesn’t appear Americans are any more prepared now than a decade ago for a major recession.
“There are more people on the margins than there were in 2008,” said Mehrsa Baradaran, an associate dean at the University of Georgia School of Law. “More people have been knocked out of the secure middle class. I think the next crisis will hurt as much if not more.”
While headlines tout a booming economy and President Trump takes arguably more credit than he’s due, there is far more risk for Americans than those headlines imply. The result is a gilded economy some would consider truly Trumpian in nature.
Katelyn Kivel is a contributing editor and senior legal reporter for Grit Post in Kalamazoo, Michigan. Follow her on Twitter @KatelynKivel.