By PAUL WISEMAN and CHRISTOPHER RUGABER, AP Economics Writers
WASHINGTON (AP) — As President Donald Trump embarks on the second year of his renewed presidency, he claims to have revitalized the U.S. economy through the strategic use of tariffs. Despite criticism from many economists and media outlets, Trump maintains that these import taxes have fueled an “American economic miracle.”
Trump’s Economic Claims Under Scrutiny
In his recent Wall Street Journal opinion piece, President Trump countered predictions that tariffs would harm the economy. He wrote, “they have created an American economic miracle.” However, scrutiny reveals discrepancies in his assertions.
CLAIM: “Just over one year ago, we were a ‘DEAD’ country. Now, we are the ‘HOTTEST’ country anywhere in the world!”
THE FACTS: Contrary to this dramatic statement, the U.S. economy was far from “dead” at the start of Trump’s second term. The GDP grew by 2.8% in 2024, a robust performance compared to most wealthy nations except Spain. Although the initial months of 2025 saw a contraction due to a surge in imports ahead of anticipated tariffs, the economy rebounded with growth rates of 3.8% and 4.4% in subsequent quarters.
Trump also points to the stock market’s 52 record highs in 2025. While the S&P 500 gained 17%, this was modest compared to significant increases in South Korea, Hong Kong, and Japan, among others.
The Inflation Debate
CLAIM: “Annual core inflation for the past three months has dropped to just 1.4% — far lower than almost anyone, other than me, had predicted.”
THE FACTS: The president’s inflation figures are skewed by temporary data collection issues due to a government shutdown. For the latter half of 2025, core inflation actually averaged 2.6%. Though inflation fears were mitigated by tariff rollbacks on items like coffee and beef, core goods prices rose significantly, marking the highest increase since 2011 outside the pandemic context. Harvard economist Alberto Cavallo’s study indicates tariffs have increased inflation by about 0.75 percentage points.
Trade Deficit and Investment Claims
CLAIM: “We have slashed our monthly trade deficit by an astonishing 77%.”
THE FACTS: This assertion glosses over complexities. While the trade deficit shrank post-tariff implementation, the initial surge in imports resulted in a 4% higher year-to-date deficit compared to 2024.
CLAIM: “I have successfully wielded the tariff tool to secure colossal Investments in America, like no other country has ever seen before. … In less than one year, we have secured commitments for more than $18 trillion, a number that is unfathomable to many.”
THE FACTS: While Trump has indeed secured investment commitments, the $18 trillion figure lacks clarity. The White House states the total at $9.6 trillion, combining private and public commitments. The Peterson Institute estimates pledges from the EU and others at $5 trillion, raising doubts about their realization due to vague agreements and financial constraints.
For further detailed analysis, visit the AP Fact Checks at https://apnews.com/APFactCheck.
