At a recent rally in Montana, Donald Trump declared: 'We're richer now. We don't have inflation.' The data tells a starkly different story. While inflation has cooled from its June 2022 peak of 9.1%, it remains stubbornly elevated at levels not seen since 2023. After briefly reaching a manageable 2.3% in April 2025, inflation climbed back to 4.2% in May and has hovered above 3.4% since. It's been nearly six years since Americans experienced inflation at a sustainable 2% level. This matters because price increases accumulate, squeezing household budgets precisely when voters are deciding who deserves their support.
The Iran war has proven particularly damaging to economic conditions. The closure of the Strait of Hormuz, through which a fifth of the world's oil typically passes, has driven gas prices to painful levels. The average price of gas reached $4.32 per gallon in mid-October, according to AAA—nearly $1.30 higher than a year ago. In California, drivers pay $6.21 per gallon, while even in oil-producing Texas, prices jumped from $2.64 to $3.81 annually. A Harris poll for the Guardian found that 83% of Americans say gas prices are making a dent in their current finances, making this the most common economic pain point.
Beyond inflation, Trump's economic record shows troubling cracks. Job creation collapsed dramatically: just 181,000 new jobs were added in 2025, compared with 2.2 million in 2024. While the unemployment rate remains low at just over 4%, economists describe this as a 'low-hire, low-fire' economy, where employers are paralyzed by harsher immigration policies, tariff uncertainty, and higher supply costs. Meanwhile, interest rates tell another cautionary tale. After falling to 4.25%-4.5% when Trump took office in January 2025, the Fed has since hiked rates—with Trump-appointed Fed chair Kevin Warsh declaring in September that 'inflation is too high and has been for too long.' Mortgage rates, which briefly dipped below 6% in February, are now past 7%.
Perhaps most damning is the emergence of a K-shaped economy, where wealth gains concentrate at the top while ordinary Americans struggle. The stock market has soared, driven largely by AI investment as tech companies spend billions on datacenters and chips. Yet the top 1% own nearly half of all stock market investments, meaning this recovery has primarily enriched the wealthy. A Harris poll found that nearly two-thirds of Americans—including some Republicans—believe the country is experiencing a recession. A third said one surprise bill could sink them financially.
Trump won office promising to fix the economy Biden supposedly broke. Instead, Americans face persistent inflation, collapsing job growth, higher borrowing costs, and a widening wealth gap. When voters head to midterm elections, they'll decide whether this reality matches the boasts at Montana rallies.