The media didn’t even wait for the first quarter of President Donald Trump’s second term to blame him for GDP events that transpired before he was even elected to office.
Media outlets like The New York Times, Reuters, The Washington Post tried to blame fears of Trump tariffs for Q4 2024 GDP numbers. From October-December, the economy saw slower-than-expected growth and upticks in consumer spending. The Post held Trump’s tariff threat liable for declining business investment while outlets like Reuters and The Times suggested it was to blame for spikes in household spending, which the outlets characterized as a surge in preemptive purchases to offset the effects of expected tariffs on imports.
This was despite the fact that Q4 data includes a period before anyone even knew Trump was going to win the 2024 election.
MRC Business consulted with experts to conduct an economic analysis on public polling trends and correlate them with the trajectory of Personal Consumption Expenditures (PCE) to assess whether there was any credence to the media narrative on Trump tariff fears having anything to do with Q4 GDP numbers.
Americans writ large have generally expressed disinterest in taking preliminary actions against the possibility of tariffs. A December 2024 Ipsos poll found that while a majority of Americans believed that tariffs overall raise prices, only 25 percent stated that they’re “stocking up more on items [they] think will cost more if the U.S. enacts tariffs on imports.”
Basically, whether the media try tying tariff fears to declining business investment or desperate households spending to get ahead of the impending doom of Trump tariffs, the short answer to the question of whether the fears are significantly relevant to Q4 GDP was a resounding “No.”
Chart I: Trump v. Biden/Harris-Post July 21, 2024
(Source: RealClearPolitics)
Using RealClearPolitics data in the above chart, we considered the approval ratings of both then-President Joe Biden and then-candidate Donald Trump between November 2023 and November 2024.
The historical trend shows that Trump held a narrow lead over then-President Biden between November 5, 2023, and July 21, 2024, when Biden dropped out of the race.
At that inflection point, Trump’s approval ratings began to sharply diverge with Vice President Kamala Harris after August 4, 2024. Registered voters were convinced between the beginning of August 2024 and the end of the last election, that then-candidate Trump would go on to win the 2024 Presidential election.
This meant that, if Trump’s threat of tariffs was going to have any effect on the electorate, it would have plausibly happened months before Q4 began in October. PCE increased on average by 0.24 percent per month. What’s even more interesting, is that for the period beginning the month after Biden dropped out, PCE grew by nearly the same amount, 0.25 percent per month.
When analyzing Real PCE, there was no noticeable, dramatic incremental change in trajectory in either a positive or negative direction (aside from the steady rise) as a result of shifting polling data pointing toward a Trump victory (See Chart II below).
Chart II: Real Personal Consumption Expenditures
(Source: St. Louis Federal Reserve)
The implication was that despite Vice President Kamala Harris’s much-celebrated entrance into the 2024 race by the media, the rate of real personal consumption expenditures remained unchanged.
This directly contradicts what those in the media would have you believe. Namely, that Trump’s economic policies, such as his tariffs, the possibility of political gridlock in regard to the Tax Cuts and Jobs Act, and continued inflation, would plunge the U.S. into yet another economic downturn and leave American households worse off than before.
The elevated levels of spending, as previous analyses have shown, was more credibly attributed to record explosions in credit card debt. In November, 2023, CNBC analyzed that the increases in consumer expenditures constituted “doom spending” as a coping mechanism to deal with the increasingly insurmountable high cost of living, even if it is detrimental to them.
That sentiment carried nearly a year later into November 2024, as Intuit concluded in an October 31, 2024 study released just before the presidential election.
ABC News reported on February 13, 2025 that total household debt (credit cards, mortgages, auto loans, student loans, etc.) hit a new all-time high of $18.04 trillion.
In February 2024, Heritage Foundation economists EJ Antoni and Peter St. Onge reported that “[m]illions of young Americans seem to have given up on their economic future, turning instead to ‘doom spending.’”
Rather than save up for a house, to start a family or for retirement, according to the authors, “which [young Americans] view as fruitless—they’re spending more than they earn without a plan to get ahead.”
In essence, it is more plausible to view the consumer spending increase in Q4 as the continuation of an ongoing trend of self-inflicted debt bombing due to rising costs than a sudden explosion of fear surrounding impending tariffs.
While the prevailing media narrative would have readers believe that households increased spending to avoid potentially higher priced goods as a result of a potential second term of Trump, the reality is starkly different. Households were spending more using credit, rather than anticipating higher priced goods and services.
If the people were concerned about more inflation, household expenditures should have decreased, rather than increased due to the economic policies Trump would be expected to advocate.The data, in effect, throws out the assumption that Americans were being driven by tariff worries to spend more.
The media should have waited before President Trump actually did something first before jumping the gun to throw immediate shade on his economic record.
