On Thursday, Nobel Prize-winning economist Paul Krugman warned that President Donald Trump and his allies are increasingly desperate to “gaslight” voters about the state of the economy. According to Krugman, there is a cognitive dissonance to their claims, as on one hand they attempt to “shift the blame” for the poor economy onto one of Trump’s longtime adversaries, while on the other hand they claim the country is in a “golden age.”
Krugman starts by noting the text that pops up when you click an economic “fact sheet” on the White House website, which reads in all caps, “Welcome to the golden age!” To this, the renowned economist responds, “Yes, Trump’s lackeys are still peddling claims that things are great, that we have the hottest economy in the world, like nobody has ever seen before. But even they know better.”
“A clear indicator that Trump sycophants realize that they are caught in reality’s snare is how they respond to any question about current economic difficulties,” asserts Krugman. “Their first sentence almost always contains the word ‘Biden,’ as they make the false claim that things were worse under Joe Biden, or that Biden somehow caused all of our current problems (including high gas prices and depleted munitions), or that Biden left an economy in shambles. Call it a bad case of Biden derangement syndrome, a desperate and utterly transparent attempt to shift the blame for the gratuitous mess that Trump and his minions have made.”
While Krugman notes that the U.S. along with the rest of the world did experience a surge of inflation in 2021-2022, which corresponded with the Biden Administration, “inflation then proceeded to fall significantly, a case of ‘immaculate disinflation’ – a drop in inflation without a recession. By the end of Biden’s term, the U.S. economy was not only in good shape, but it was doing better than every other advanced country.” Here he points to an Economist cover from October 2024, which declared the U.S. the “envy of the world” over its unparalleled post-pandemic economic recovery — headed by Biden.
“Yet, since Trump re-assumed the presidency, most measures of economic performance have deteriorated significantly,” writes Krugman. “Economic growth has slowed despite the AI boom. Inflation has accelerated. Interest rates have surged. Furthermore, inequality has surged in the current K-shaped economy. Wages haven’t kept up with inflation, but corporate profits have soared.”
While Krugman acknowledges that “things could be worse,” noting that inflation is still below historic highs, and unemployment is still relatively low, he also argues such details are "cold comfort given that today’s economic difficulties were all self-inflicted by Trump.” What’s more, writes Krugman, “today’s economy is a far cry from the paradise that Trump promised in order to beat Kamala Harris. Remember how he was going to cut energy prices in half and bring down grocery prices on day one? The dissonance between his constant boasting and the reality of an economy in which households saying that they are worse off than a year ago outnumber those saying they’re better off almost two to one is surely a major factor in Trump’s surreally poor approval rating on the economy.”
“Just like Trump’s farcical plan to lower beef prices to consumers by importing (possibly unsafe) foreign mystery meat, or Bessent’s attempt to gaslight the bond markets (as one wag accurately put it, Bessent’s plan is like using your credit card to pay down your mortgage), blaming Biden for the Trump economy smells of desperation,” Krugman concludes. “My advice: they should save themselves the bother. That ship has sailed and it’s heading straight for the November elections.”
