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WASHINGTON (AP) — President Donald Trump got worrisome news on Wednesday about how the U.S. economy is battening down for potential fallout from his tariffs — and he was quick to try to pin the blame on his Democratic predecessor, Joe Biden.
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The government reported that the U.S. economy shrank at an annual rate of 0.3% during the first three months of the year. Behind the decline was a surge in imports as companies tried to front-run the sweeping tariffs on autos, steel, aluminum and almost every country. And even positive signs of increased domestic consumption indicated that purchases might be occurring before the import taxes lead to price hikes.
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Trump pointed his finger at Biden as the stock market fell Wednesday morning in response to the gross domestic product report.
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“This is Biden’s Stock Market, not Trump’s,” the Republican president, who took office in January, posted on his social media site. “Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers. Our Country will boom, but we have to get rid of the Biden ‘Overhang.’ This will take a while, has NOTHING TO DO WITH TARIFFS.”
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But the GDP report gives Democrats ammunition to claim that Trump’s policies could shove the economy into a recession.
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The report landed as Trump is trying to put the focus on new corporate investments in the U.S. as he spends the week celebrating his 100th day in office. He planned remarks later in the day on the subject.
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Trump’s economic message contains some clashing arguments and dismisses data that raises red flags.
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He wants credit for an aggressive first 100 days back in the White House that included mass layoffs of federal workers and the start of a trade war with 145% in new tariffs against China. He also wants to blame the negative response of the financial markets on Biden, who left office months ago. He’s also saying his tariffs are negotiating tools to generate trade deals but at the same time banking on hundreds of billions of dollars in tariff revenues to help cover his planned income tax cuts.
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Asked about his tariffs causing inflation, Trump told ABC News in a Tuesday interview that the economy would have eventually imploded if he didn’t impose import taxes on allies including the European Union, Canada, Mexico, Japan, South Korea and India.
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“Everybody’s gonna be just fine,” Trump assured.
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Democrats’ statements after the GDP report noted how quickly the economy, which still has a healthy 4.2% unemployment rate, appears to lose momentum within weeks of Trump returning.
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