Trump Says Economy Will Boom Despite GDP Dip, Denies Tariff Role/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ President Donald Trump blamed former President Joe Biden after the U.S. economy contracted 0.3% in the first quarter, with import surges and tariff fears dragging growth. Trump dismissed any link to his new trade policies, instead claiming a “Biden overhang” caused the downturn. Democrats, however, argue Trump’s erratic economic actions are pushing the nation toward recession.
Trump’s GDP Defense: Quick Looks
- U.S. economy shrank 0.3% in Q1 2025, first drop in years
- Trump blames Biden-era policies, dismisses tariff concerns
- Imports surged as firms rushed to beat looming tariffs
- Trump claims tariffs will fuel long-term economic boom
- Democrats say Trump’s chaotic start is slowing growth
- Unemployment remains low at 4.2%, but outlook softening
- Trump uses tariffs to fund income tax cut plans
- Commerce Secretary Lutnick touts TSMC investment—launched under Biden
- Trump claims chips are coming due to tariffs, not subsidies
- Democrats: “Costs, chaos, and corruption” define first 100 days
Trump Says Economy Will Boom Despite GDP Dip, Denies Tariff Role
Deep Look
Tariff-Linked Economic Dip Triggers Blame Game Between Trump and Biden Camps
WASHINGTON — President Donald Trump on Wednesday attempted to shift blame for a slowing U.S. economy onto his predecessor, even as economists point to his newly imposed tariffs as a significant cause for concern.
Fresh Commerce Department data shows that U.S. gross domestic product (GDP) contracted at an annualized rate of 0.3% during the first quarter of 2025 — a troubling reversal from steady growth in late 2024. Analysts say the dip reflects economic uncertainty triggered by Trump’s aggressive tariffs, which prompted a flood of imports ahead of anticipated price hikes.
Still, Trump insisted the downturn was not his fault.
“This is Biden’s Stock Market, not Trump’s,” he posted to Truth Social. “Our Country will boom, but we have to get rid of the Biden ‘Overhang.’ This will take a while, has NOTHING TO DO WITH TARIFFS.”
Yet the numbers suggest otherwise. Imports skyrocketed as businesses scrambled to get goods into the U.S. before new import taxes took effect, especially on autos, steel, and aluminum. That import surge — which subtracts from GDP — drove the contraction. Domestic spending rose, particularly on cars, indicating consumers were also bracing for cost increases.
Democrats wasted no time responding.
“In just 100 days, President Trump has taken the U.S. economy from strong, stable growth to negative GDP,” said Heather Boushey, a former Biden economic adviser. “This astonishing turn of fortune is directly due to the incoherence of his economic policy.”
Trying to Reframe the Narrative
Despite celebrating his 100th day back in the White House with a rally in Michigan and planned remarks on business investment, Trump now faces scrutiny over the direction of the economy under his leadership. While unemployment remains low at 4.2%, signs of economic cooling are starting to stack up — raising concerns about stagflation: a toxic mix of inflation and stagnation.
Sen. Jeff Merkley (D-Ore.) put it bluntly: “Costs, chaos and corruption are already on the rise.”
At a Cabinet meeting, Trump highlighted optimistic parts of the GDP report but also claimed credit for semiconductor manufacturing growth initiated under the Biden administration. Commerce Secretary Howard Lutnick discussed his recent visit to TSMC’s chip factories in Arizona. Trump suggested tariffs, not Biden’s CHIPS Act incentives, were the real catalyst.
“They’re building because of the tariffs,” Trump said, even though the projects were announced under both Trump and Biden and secured funding through bipartisan legislation signed by Biden.
Conflicting Messages, Uncertain Future
Trump is leaning on tariffs to fulfill multiple promises: reshoring jobs, financing tax cuts, and pressuring foreign governments into trade deals. Yet businesses and economists warn the strategy may backfire, pushing prices higher and suppressing consumer confidence.
In a Tuesday interview with ABC News, Trump brushed off inflation concerns tied to his tariffs.
“Everybody’s gonna be just fine,” he said, adding that the U.S. economy “would have collapsed” if he hadn’t moved quickly on trade.
Some Trump officials echoed that optimism. White House trade adviser Peter Navarro called the GDP report a “one-shot deal” caused by a temporary trade imbalance, not underlying weakness.
“All we’re seeing is good, strong news,” Navarro said. “So the idea that there’s a recession coming should be heavily discounted.”
Still, with the Federal Reserve signaling caution on interest rate cuts and corporate earnings painting a mixed picture, Wall Street and Main Street alike are bracing for potential headwinds.
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