The U.S. economy was in much worse shape than previously thought during the 2024 election between President Donald Trump and former Vice President Kamala Harris, revised labor markets data from the Bureau of Labor Statistics shows, with a downward revision of almost 1 million from jobs from the establishment survey of employers as jobs figures published to the American people were greatly overstated, only producing 855,000 jobs instead of 1.76 million from March 2024 to March 2025.
The unreliable establishment survey data came at a time when the household survey has shown unemployment steadily increasing by 1.6 million January 2023 to its current 7.38 million level as inflation has cooled, which it appears to have done once again in August as producer prices contracted 0.1 percent according to the Bureau of Labor Statistics, while the 12-month reading came in at 2.6 percent, far below its 2022 high of 11.6 percent in March 2022.
That’s usually when the Federal Reserve starts cutting interest rates, which it has, at least in 2024 it did three times, before pausing rate cuts in 2025, citing inflation concerns over President Trump’s tariffs while economies all over the world were cutting rates.
But whatever feedback from the tariffs, it did not adversely impact producers in August. Food only grew 0.1 percent, energy was down 0.4 percent. Less food and energy was 0.3 percent. And that’s with pretty much all of the tariffs in place now.
Almost a year into the second Trump administration, and high inflation is nowhere to be found but the slowdown in labor markets is real enough.
Responding to the inflation news, on Truth Social on Sept. 10, President Trump wrote, “Just out: No inflation!!! ‘Too Late’ must lower the RATE, BIG, right now. Powell is a total disaster, who doesn’t have a clue!!!”
In terms of being “too late,” the President has a point, as consumer inflation had already hit 8.5 percent in March 2022 before the Fed began hiking rates in the first place, with consumer inflation eventually peaking at 9.1 percent in June 2022.
Now, almost a year after the disastrous Biden administration has ended, and the economy is even weaker than was originally thought. If inflation were going to get really high, that would imply the economy was overheating. Instead, as can be seen with sinking demand and cooling labor markets, the opposite is happening. Maybe the Fed’s crystal ball got cracked.
Robert Romano is the Executive Director of Americans for Limited Government Foundation.
