By Paul Wiseman and Christopher Lugerber
WASHINGTON (AP) — When the stock market rose in January 2024, Donald Trump knew exactly who was worthy of credit.
A year ago back to the White House, he declared that on his true social platform, investors were celebrating his lead in the vote against President Joe Biden.
When stock markets fell Wednesday on news that the US economy had receding in the first three months of 2025, Trump knew exactly who to blame: Biden.
“This is Biden’s stock market, not Trump’s stock,” he posted, and Biden said, “It left us with a bad number, but once the boom starts, there’s no doubt else. Hold on!!!”
Trump also said, “Our country is booming, but we need to remove the Biden “overhang.” “This takes a while and has nothing to do with customs duties. ”
But for economists who are bewildering how prices and employment will change in the coming months, or how businesses struggling with a completely uncertain future, the massive, unpredictable import taxes on almost every country in Trump actually have a lot of responsibility. The new president’s policies rarely have a very sharp impact on the economy.
Trump’s claims sound like a brave double standard to Mark Zachary Taylor of Georgia Tech, who studies the economic policies of the US president. “He can’t have it both ways,” Taylor said in an email.
At what point in his four-year term will the new president be responsible for economic performance in his attempt to turn the blame on bad economic news into his predecessor?
Commerce Secretary Howard Lutnick said in an interview that the benefits of Trump’s policy will be felt later this year, particularly in the fourth quarter.
And Taylor points out that for a typical president, “it could take six months to two years to call the economy exactly “their thing.”
However, the threshold is different for a president entering the White House with great ambitions to rebuild the economy from the start.
“The more boldly an emerging president acts (and the stronger his support of Congress), the faster the economy becomes, the faster he becomes,” Taylor said.
The most notable example is President Franklin D. Roosevelt pushed for major legislation, including a bill that effectively establishes deposit insurance to curb the banking crisis. Presidents Ronald Reagan and Barack Obama were also in office during the economic crisis and moved quickly to deal with them.
But even they did not move economic data as quickly or sharply as Trump. On Wednesday, the government reported that imports have skyrocketed since 1972, at 41%, which is 41% (excluding the pandemic).
Import floods have reduced growth under government accounting, and the economy has shrunk by 0.3% annually, marking the first decline in two years. The negative show urged Trump’s Biden bashing post on Wednesday.
The numbers are “exactly what we expect from millions of American businesses and households looking to preempt the looming tariff hikes,” adding that Trump’s trade war is also responsible for the decline in stock markets and the decline in the value of the dollar.
Research shows that manufacturers have fewer orders and production is declining. On Thursday, the Supply Management Institute, the industry association for purchasing managers, released a monthly survey of the manufacturer. This usually involves selecting comments from your membership.
Comments usually reflect individual concerns in a particular industry, such as chemicals, electronics, and clothing manufacturers. In the April report, all 10 comments (all one) focuses on tariffs.
“Taxes affecting operations — specifically, delays in border crossing delays and calculations of duties that are not fully understood,” said a company with a transportation equipment division. “As a result, we are potentially overpayment obligations.”
Trump blasted the existing global trading system by slapping 10% import taxes (customer duties) on friends and enemies as well. He was smeared with 145% tariffs on China, causing retaliation from Beijing, threatening to end trade between the two world economies. He also hits foreign steel, aluminum and automobiles.
The unstable way he developed protectionist policies — the introduction, subsequent suspension of tariffs, the announcement of new ones — has baffled businesses, consumers and investors. The S&P 500 stock index fell 7% from just before its inauguration date on January 20th. Consumer trust is dying.
“Some of what you’re looking at now is purely Trump-related,” said Joseph Stiglitz of Columbia University, a Nobel Prize-winning economist and chairman of the Clinton administration’s White House Economic Adviser Council.
Original issue: May 1, 2025, 5:19pm EDT
