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There is no shortage of colorful language (and memes!) being used today to describe the new Trump Tax we're all about to pay -- after having been "liberated" from, y'know, paying less money for stuff. I chose the term financial pundit Ross Gerber used to describe it for the headline, as it seemed the most descriptive:
Before the votes were counted in Wisconsin last night, Elon Musk said the race "might decide the future of America and Western civilization" and "the future of the world." Afterwards, he tried to spin the outcome: "I expected to lose, but there is value to losing a piece for positional gain." Nice try, Elon.
So... is everyone ready to pay more for everything? Because that's why America elected Donald Trump president, right?
On Wednesday, Trump will be announcing sweeping tariffs on the entire rest of the world. As he likes to put it, "tariff" is his new favorite word in the dictionary. But consumers are likely to call it what it will actually be, to them: a tax. A big fat "Trump Tax" on all sorts of things consumers buy. Which will likely drive up inflation, and which will definitely hit consumers hard in the pocketbook.
In keeping with the "world turned upside-down" nature of this week, we are going to start with a few things that haven't been front-and-center, then we'll circle in to a bigger-picture take, and finally we'll fit in the big story of the week at the end.
Without a doubt, we now live in Orwellian times. Anyone who runs afoul of the Dear Leader must be punished. The truth is whatever the Dear Leader says (even when he contradicts something he earlier said). We don't have a Ministry of Truth (yet), but we do have Truth Social. We have always been at war with Canada, and Russia has always been our friend, right? The past is being rewritten, erasing any mention of the trans people who were instrumental in leading the Stonewall Riots, and any mention of why pioneers like Jackie Robinson weren't considered just some random baseball star. Maybe Rosa Parks will be next: "She was just some woman on a bus... not really sure why some woman on a bus is historic, but everyone remembers her name for some reason...." In all this Orwellian flood, though, the one that stands out for me is the up-is-down nature of the richest man in the world absolutely destroying major government departments in the name of "government efficiency." That one really takes the Orwellian cake, as it were.
President Elon Musk and his figurehead Donald Trump inched closer to a constitutional crisis (once again) last week. It still hasn't been fully resolved, so we've all got more of this to look forward to next week as well.
Trump invoked a law from the 1700s this week which would allow him personally to determine who gets deported. No due process, no hearing before a judge -- none of that. Just Trump deciding: "I don't like this guy, let's kick him out." The Alien Enemies Act is only supposed to apply when the United States is at war with another nation, and has only been used three times -- the most recent being the shameful internment of Japanese-Americans during World War II. But as far as Trump is concerned, it doesn't matter than we aren't at war, he just doesn't want to deal with the courts at all.
Senate Minority Leader Chuck Schumer is in the Democratic doghouse right now, after he (and a few other Democrats) recently voted with the Republicans to keep the government open, rather than forcing a shutdown which would have allowed Elon Musk to shift his efforts to eliminate the federal government into warp speed. It was a real "damned if you do, damned if you don't" situation for Schumer, but his performance and leadership have been heavily criticized (and denounced) by other Democrats ever since. Which isn't a good place for the highest-ranking Democrat in the entire federal government to now be. So should Schumer stay in his Senate leadership position, or should he go?
As is now the new normal, there were so many things happening in the political world this week it is hard to keep track of them all. But what is currently in the center ring is the vote happening in the Senate on the continuing resolution to fund the government for the rest of this fiscal year.
While the biggest political spectacle of the week was the president's big speech to Congress, the biggest political news of the week was actually the American economy reacting to Donald Trump's on-again-off-again, now-you-see-them-now-you-don't tariffs. The whiplash began at the start of the week and hasn't fully subsided yet. Taken together with all of Trump's other disruptive wrecking balls, economists are now starting to talk about the possibility of an upcoming "Trump recession."
Is America headed for a "Trump recession" already? Economists are starting to get worried. So are consumers. And the stock market has been in a deep dive ever since the tariff threat became real this week. So the possibility now exists -- we could be headed for an economic trainwreck. And if it happens, there will be a big difference from normal business-cycle recessions, because this time the reason why it happened will be pretty obvious to everyone.