The core of the modern American dream is cheap stuff. Contrary to President Donald Trump’s suggestion earlier this year, it turns out little girls do need 30 dolls — or at least, their families want to be able to afford them without the White House telling them otherwise.
The Trump administration’s economic message during the opening months of the president’s second term was, in essence: deal with it. Yes, tariffs would cause short-term pain, and efforts to reshore manufacturing plus curb immigration might increase labor-market uncertainty. But officials insisted it would all be worth it.
That’s how Treasury Secretary Scott Bessent ended up saying that access to inexpensive goods is “not the essence of the American dream,” while Trump suggested kids should make do with fewer pencils. The messaging isn’t landing.
Sacrifice is not something consumers enjoy, especially when the payoff is vague at best and, at worst, contradicts the kind of economy they desire. Prices continue to rise, and “affordability” is the buzzword of the moment. Consumers are frustrated with the lack of it everywhere they look.
“They had a theory of the case of how the economy would evolve earlier this year,” says Mike Konczal, senior director of policy and research at the Economic Policy Institute, an economic think tank.
The administration believed that mass deportations would open up jobs for American workers, government layoffs (dubbed “DOGE-driven”) would push workers toward the private sector, and tariffs would incentivize a manufacturing boom and reshoring. So far, most of it hasn’t worked out.
“Even nonpolitical people are aware that something’s floundering here,” Konczal adds.
Trump, who rose to the White House largely on the promise of bringing down costs, is now scrambling to refocus. He’s floating haphazard policy ideas that economists are generally dubious about, claiming prices are already down (true for some products but definitely not for others), and expressing exasperation at the whole situation.
Voters often blame the president for their problems, and right now, that president is Trump. He’s learning a lesson the Biden team faced as well: you can’t force your way to a strong economy.
### The Affordability Crisis Resonates with Voters
As much as conservatives may dislike New York City Mayor-elect Zohran Mandami, they are paying attention to him — especially his campaign’s relentless focus on affordability. Whether or not people agree with the democratic socialists’ solutions, the message resonates clearly: rent and the price of everything else is too damn high.
Americans in New York and nationwide are justified in their frustration. Consumer prices have increased by 25% since 2020. While inflation seemed to be slowing around mid-2025, it has picked up again and is on track to end the year at about 3% annual growth.
The compounding effect of years of price hikes is taking a financial and psychological toll. Claudia Sahm, chief economist at New Century Advisors, notes, “It’s that cumulative piece of it.”
Gas and egg prices have come down from their highs earlier in the year, but coffee, beef, and bananas are on the rise.
Beyond groceries, durable goods — like furniture, appliances, and electronics — saw prices increase by 1.5% over the first eight months of the year. Last year for the same period, prices actually fell by 1%, with expectations that declines would continue into 2025.
“It’s not just that they rose at all, it’s that we were expecting a decline,” says Ernie Tedeschi, a non-resident senior fellow at Yale Budget Lab. “That’s not pandemic size, but it’s a meaningful increase.”
Service prices—covering entertainment, transportation, healthcare, childcare, and housing—have also continued to rise at an elevated pace.
Housing costs present a particularly daunting reality for many. The median home sales price in the U.S. is over $400,000 — up from around $300,000 just five years ago. Childcare costs families thousands of dollars yearly. Healthcare expenses are expected to rise steeply for many Americans next year.
### Public Sentiment and Economic Challenges
“People are broadly feeling pretty negative about the economy,” says Joanne Hsu, director of consumer surveys at the University of Michigan.
Consumers are “perfectly aware” that inflation rates have fallen. Still, even if goods aren’t rising in price as quickly, memories of previous sticker shock remain aggravating. Add to that the worry that tariffs mean we’re not out of the woods regarding future price hikes.
Another important factor is weakening incomes. Many people are concerned about job security, labor market conditions, and stagnant paychecks. In the University of Michigan’s November survey, 29% of respondents cited softer incomes as a negative for their personal finances, up from 20% just a month prior.
Although average wages for many workers still outpace inflation, the job market itself is stagnant, with many employees stuck in place. Michael Madowitz, principal economist at the Roosevelt Institute, explains that while entry-level workers are frustrated after hundreds of interviews, another, quieter group of workers who relied on job-hopping for raises no longer have that option.
“That’s actually neither great for them nor for their employers,” Madowitz says.
The takeaway? People are tired of being surprised by rising prices and increasingly annoyed that their incomes aren’t stretching as far.
### The Political Fallout
A Washington Post-ABC News-Pisos poll from October found 71% of American adults say they’re spending more on groceries compared to a year ago.
Many consumers had hoped prices would fall, not realizing that in many cases, the best outcome would be prices stabilizing rather than dropping.
“Tedeschi notes, “As a former Biden administration official, I can say we learned the hard way that consumers do not distinguish between price levels and inflation.”
When people get angry, they seek someone to blame. This time, it’s Trump. The WaPo-ABC poll found 59% believe the president is responsible for current inflation levels.
A Quinnipiac poll from October revealed only 38% of Americans approve of Trump’s handling of the economy — his lowest point since February 2017.
“I think the American people realize that’s just not a priority for this administration,” says Konczal.
### Trump’s Response and Policy Moves
Trump, who campaigned on “making America affordable again,” has struggled to counter growing disillusionment.
In early November, during a press conference, Trump touted the reduced cost of Walmart’s Thanksgiving basket but overlooked that the 2025 edition had fewer items. He brushed off concerns about rising prices, declaring, “I don’t want to hear about the affordability.”
Shortly after, Treasury Secretary Bessent said the administration planned to lower coffee and banana prices “very quickly,” and the president signed an executive order dropping reciprocal tariffs on foods such as beef, coffee, and avocados.
The White House also announced deals to cut prices of weight-loss drugs.
Following Mandami’s election, Trump floated several policy ideas that might tackle the cost-of-living crisis, including sending $2,000 checks to low- and middle-income Americans as a tariff rebate and introducing 50-year mortgages.
However, many economists and real estate analysts remain unconvinced. Sending out checks would require Congressional approval, and projected tariff revenues aren’t enough to cover the cost.
Fifty-year mortgages could mean homebuyers pay significantly more in interest and take longer to build equity. They may also increase demand for homes, pushing prices higher and adding stress to an already tight housing supply if new construction doesn’t keep pace.
Even some Trump-friendly voices are pressing for answers on affordability. Fox News hosts Laura Ingraham and Brett Baier have asked the president to address these concerns, which he has mostly dismissed.
In a CNN interview, GOP Rep. Marjorie Taylor Greene shared her own experience: “I go to the grocery store myself. Grocery prices remain high. Energy prices are high. My electricity bills are higher here in Washington, DC, at my apartment, and they’re also higher at my house in Rome, Georgia.”
### The Challenge of Economic Leadership
The presidency means taking credit for successes — and blame for failures.
In a statement to Business Insider, White House spokesperson Kush Desai said “cleaning up Joe Biden’s inflation and economic disaster has been a top focus since Day One,” highlighting falling gas and egg prices alongside a “historic drug pricing deal” on GLP-1 drugs.
“The Trump administration will continue to implement and emphasize these and other economic policies that are cutting costs, raising real wages, and securing trillions in investments to make and hire in America,” he said.
Both Trump and Biden face the challenge of convincing a skeptical public that the economy is better than it seems.
Consumers may not know the exact price of every grocery item, but they’re aware their weekly basket is costing more. Some are buying less or smaller portions to save money; others are relying on credit cards to make ends meet — essentially taking the White House’s advice, but not by choice: they are sacrificing.
### No Easy Fixes
“The price puzzle is a hard one to solve,” Sahm remarks. “There’s no low-hanging fruit here, especially with housing.”
Housing policy is largely shaped at state and local levels, limiting federal impact.
“You can look to the White House and Congress to actually go after specific price imbalances,” Sahm continues, “but it takes thought and effort.”
Trump has attacked the Federal Reserve and demanded lower interest rates, which could help reduce mortgage and lending rates. However, the Fed’s tools are blunt instruments, not finely targeted solutions, and some of Trump’s policies — like tariffs — may have impeded the Fed’s ability to help.
“They would’ve lowered interest rates more this year if you hadn’t unleashed tariffs,” Sahm says.
Ultimately, being president means owning both the good and the bad. Fairly or not, Americans have viewed the economy as struggling for some time now. It’s up to Trump to fix it.
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*Emily Stewart is a senior correspondent at Business Insider, covering business and the economy.*
https://www.businessinsider.com/trump-biggest-economic-mistake-prices-affordability-2025-11