New Data Confirms Failed Tariffs Are Dragging Down the US Economy

Apollo CEO Rowan’s warning landed with stark clarity: the United States risks two quarters of negative growth, signaling a potential recession. Economic data confirms the danger. First-quarter GDP shrank 0.3%, consumer spending weakened, and manufacturing stumbled. For millions of Americans, this translates to higher prices, job insecurity, and shrinking opportunities. The urgency to act grows by the day.

Current policies bear much of the blame. Import tariffs, averaging 14.5%, have disrupted supply chains and inflated costs for everyday goods. Promoted by the administration as a defense of American jobs, these levies have instead burdened families and businesses. Progressive economists have long warned of their harm, and the evidence is clear: trade barriers are dragging the economy toward a cliff.

Democratic leaders propose a smarter path. They advocate suspending tariffs on allied nations and launching a major infrastructure program to create jobs. This vision draws on proven strategies, like the fiscal stimulus that steadied the economy after 2008. For those unfamiliar with policy debates, the issue boils down to priorities: policies that lift workers and families versus those that deepen hardship.

The impact hits close to home. Rising grocery bills, layoffs in factories, and stalled construction projects affect real people. A recession would amplify these struggles, making bold action essential. Leadership must focus on solutions that rebuild confidence and opportunity for all.

Tariffs have failed to deliver on their promises. The IMF cut its 2025 global growth forecast to 2.8%, citing trade disruptions as a primary cause. In the US, these policies slashed GDP projections from 2.7% to 1.8%. Businesses, rushing to import goods before costs rise further, have strained supply chains. Consumers face the fallout, with food inflation near 3% and broader price pressures looming.

President Trump and his advisors defend tariffs as a boost to manufacturing. Yet, first-quarter data shows weakening factory output and volatile durable goods orders. The Federal Reserve’s rate hikes, pushing mortgage rates to 6.7%, add pressure, but tariffs remain the larger obstacle. They inflate material costs, deter investment, and squeeze small businesses unable to absorb the hit.

Progressive thinkers, including Senator Bernie Sanders and economist Paul Krugman, urge a pivot. They call for refundable tax credits and clean energy investments to drive demand and create sustainable jobs. These measures echo the fiscal interventions that softened the Great Recession’s blow. A multitrillion-dollar plan to rebuild infrastructure could revitalize communities and spur growth.

Critics, including Republican policymakers, warn of rising deficits, citing the $18 trillion federal debt. However, a recession would cost far more, slashing revenues and spiking unemployment. The priority must be stabilizing the economy through targeted investments, not clinging to failed trade policies.

The economy reflects the lives of its people. Consumer spending, nearly 70% of GDP, is faltering. February card transactions fell 3.4%, and most households are opting for cheaper brands. Surveys show growing inflation fears, signaling widespread anxiety. These trends warn of deeper economic trouble unless decisive steps are taken.

Democratic proposals offer a way forward: expand tax credits, ease tariffs on allies, and invest in green infrastructure. These actions would bolster household budgets, stabilize markets, and create jobs in growing industries. Unlike the tax cuts favored by fiscal conservatives, which often benefit the wealthy, this plan prioritizes workers and small businesses.

Some Republican leaders argue that such spending risks inflation, despite CPI at 2.4% and trending downward. The greater danger is inaction, as tariffs erode growth and the Fed’s high rates, at 4.25%–4.50%, curb lending. Fiscal policy is the strongest tool available, and it must be used to support the public.

For readers, the goal is clear: an economy where jobs are secure, costs are manageable, and communities flourish. Progressive policies aim to deliver that future, grounded in evidence from past recoveries. Tariffs have fueled division and decline; it’s time to choose unity and progress.

The United States faces a critical moment. The IMF estimates a 40% chance of recession, while prediction markets raise the odds to 59%. Rowan’s alert about consecutive negative quarters underscores the stakes. A downturn would hit workers, businesses, and families hardest, undoing years of hard-won gains.

Progressive solutions—easing tariffs, boosting tax credits, and funding infrastructure—provide a roadmap. These steps, rooted in successful post-2008 policies, prioritize people over politics. The alternative, doubling down on tariffs and deregulation, risks further instability. Americans deserve leadership that acts decisively to secure their future.