The 'Greatest Year Ever'? Trump Tries to Sell His Economy and Tariffs

TRUMP-MICHIGAN-Reuters
Reuters
By Yuval Rosenberg and Michael Rainey

Happy Monday! Here's what we're watching while waiting to see LeBron James hit the court in his new 76ers uniform.

Trump Tries to Sell His Economy and Tariffs in Battleground Michigan

With 99 days until the November midterm elections, President Trump visited General Motors Proving Grounds in Milford, Michigan, on Monday, where he defended his tariff policies and touted the economy under his leadership, even as voters continue to give him poor marks on both issues.

"In my first term, we had the greatest economy in the history of our country," Trump claimed. "And we're blowing it away this time. You're going to see the results very soon."

Trump imposed new tariffs of 10% to 12.5% this month on imports from 60 economies as well as a 25% tariff on certain goods from Brazil and a 50% tariff on some imports from Canada. Combined, those tariffs could raise about $950 billion through fiscal year 2036, according to an analysis by the Committee for a Responsible Federal Budget. The new set of tariffs would replace less than 60% of the projected revenue from Trump's earlier tariffs that were struck down by the Supreme Court, CRFB said.

The expected revenue from the tariffs hasn't blunted the economic concerns they've raised, particularly in places like Michigan, where the economy relies significantly on neighboring Canada. But Trump argued that his policies, including the sweeping tariffs, have boosted the U.S. auto industry and its workers. He said that the country "may" have a different president in two and a half years, and that person will claim credit for the new factories and economic growth he created. He sought to portray Democrats as "communists" and warned that they could destroy what he's accomplished.

"We're having the single greatest year we've ever had as a country," Trump claimed at one point. "We're not going to let these people destroy it."

Curtis Hertel, chairman of the Michigan Democratic Party, criticized Republicans for supporting what he described as a "toxic" Trump agenda that's raising costs for Michigan families.

"We're happy to have the president here, campaigning with Republicans," Hertel told the Associated Press. "It's good for us every time the president is here because he's incredibly unpopular."

Voters certainly aren't seeing the economy Trump described, based on numerous polls. Trump's job approval rating has hovered around or below 40%. And views of the economy have been worse:

  • A Fox News poll released last week found that just 33% of voters said they approved of Trump's handling of the economy, while 67% disapprove. Only 27% approve of his handling of inflation.
  • That same poll found that 41% of respondents rate current economic conditions as "poor" and another 35% call them "only fair." Just 21% view the economy as good, and only 3% call it excellent. The poll also found that 54% of those surveyed said they think Democrats would do a better job on the economy and inflation.
  • A YouGov survey conducted on July 22 found that 46% of U.S. adults said that Trump's tariffs have increased prices on things they bought by a lot. Another 26% said the tariffs had raised prices a little.

The bottom line: Trump has repeatedly dismissed affordability concerns, but voters say that economic issues are top of mind ahead of the November elections. Some in the Republican Party may be happy to hear Trump focus on the economy rather than, say, the unpopular Iran war or his election warnings, but the president will likely find it challenging to sell this economy or blame current conditions on a predecessor who left office 18 months ago

Voters Aren't Too Excited About Trump's Big, Beautiful Tax Overhaul

Republicans are hoping they'll be rewarded at the polls this fall for the tax cuts they passed in the One Big Beautiful Bill Act last summer, but it looks like voters aren't very impressed with the legislation - if they even know about it at all.

New polling data from Politico shows that nearly half of respondents said they haven't heard about the legislation or couldn't explain what it did, while just 11% said they could explain what it accomplished in detail.

That lack of resonance for the legislation that provided "no tax on tips" and new tax breaks for overtime and seniors is nothing new, and a major reason Republicans have tried to rebrand the tax package as the Working Families Tax Cuts.

Nearly a year later, the rebrand doesn't seem to have helped much. In the new Politico poll, a plurality of respondents (34%) said they thought the tax legislation provided some tax cuts overall, but those cuts conceal larger tax breaks for the wealthy. Only 14% agreed that it provided substantial tax breaks, while 21% said it provided no tax breaks and 30% said they did not know.

The poll of 2,061 U.S. adults taken July 12 to 15 showed that those who voted for Trump in 2024 are not much more impressed than voters overall. While a higher percentage said they thought the legislation provided substantial cuts (26%), about the same proportion (35%) said the tax breaks concealed larger breaks for the wealthy. Sixteen percent said there were no tax breaks, and 24% said they didn't know.

In terms of direct benefits, just 8% of respondents said they had gotten a big financial boost from the tax cut package, while 14% said they had gotten a minor benefit. About one in three, on the other hand, said the legislation had hurt their bottom line.

More tax cuts ahead? Although Republicans seem to have gotten little political benefit for the tax package they passed last summer, some GOP lawmakers are pushing ahead on plans to provide yet more tax cuts. House Majority Leader Steve Scalise recently discussed a potential "reconciliation 4.0" bill focused on proving spending reductions by cracking down on "waste, fraud and abuse" that could also include tax cuts. (The first reconciliation bill was the tax package last summer; the second, which funded border and immigration control operations for the rest of Trump's term in office, became law last month; and the third, which would largely provide supplemental funds for the military, is currently working its way through Congress.)

Rep. Jason Smith, chair of the House Ways and Means Committee, reportedly wants to raise the pass-through deduction for qualified businesses to 25%, up from the current 20% level that was created in the Tax Cuts and Jobs Act in Trump's first term.

Working with what they've got: In the meantime, Republicans are continuing to push the tax cut package they passed last summer, albeit under its rebranded name. "Putting more money in Americans' pockets," Senate Majority Leader John Thune said last week. "That is the Working Families Tax Cuts at work."

The polling data, however, suggests that Republicans may have trouble breaking through with that message, especially as more recent events dominate the narrative. For example, a majority of poll respondents - 57% - said that Trump's war with Iran had made things more expensive for them, making it that much harder to convince people that they are better off due to tax changes from last year.

Democrats have also used the tax cut package to accuse Republicans of being more interested in helping the wealthy than middle-class voters. "Trump cuts food assistance and health care. Billionaires get another tax break," Senate Minority Leader Chuck Schumer said recently.

That sense that the GOP tax cut bill, by whatever name, was tilted toward the wealthy is backed up by both polling data and economic analysis. In the Politico poll, more than 40% of respondents earning over $100,000 a year said they had benefited from the tax cut package, about double the rate of those earning less. And more than one independent economic analysis shows that the wealthy gained more from the law than others.

A recent analysis of last year's tax package by the Tax Policy Center shows that in 2026, "the average tax cut is generally larger for higher-income households than for lower-income households." By one metric, "the top 20 percent of households receive almost 60 percent of the tax cuts, and the top 5 percent (with incomes over $460,000) receive over 35 percent. The bottom quintile gets an average $150 tax cut, while the top quintile gets an average tax cut of over $12,000."

The bottom line: Republicans passed a major tax bill last summer, but voters have their doubts about its benefits for the average American and may be focused on other issues come November.

Trump Demands Senate Cancel August Recess and Pass SAVE America Act

As he continues to push for the Senate to pass a package of voting restrictions and eliminate the filibuster, President Trump on Monday again dialed up the pressure on Senate Majority Leader John Thune.

In a post on his social media site, Trump said that Thune should not allow the Senate to leave for its August recess until it passes the SAVE America Act or - better yet, Trump said - "terminates" the filibuster.

"Republicans can then quickly pass everything they ever dreamed of," Trump wrote, adding that the "Dumocrats" would do the same "on day one" if they regain control of the Senate. "Remember, stupidity always brings LOSING & DEATH!" Trump warned

The House has already left for its five-week summer recess, but the Senate is scheduled to be in session this week and next. Trump's call for the chamber to cancel its August break amplified a push started this weekend by Utah Republican Sen. Mike Lee, who declared in posts on X that he objects "to any effort to put the Senate into recess in August-at least until such time as the Senate has passed the SAVE America Act."

Florida Sen. Rick Scott endorsed the idea, saying he would vote to stay in session until the election bill was passed.

Thune responded to Trump's latest comments Monday by again pointing to the basic math problem he and the White House are facing: There just aren't 50 votes in the Senate to kill the filibuster or 60 votes to force a vote on the SAVE America Act.

"If I thought there was a path for getting a result, I'm all for it. I'm a cosponsor of the SAVE Act. We voted on it two, three, four, five times already. We had it up on the floor for an extended period of time," he said. "Show me how this ends. What's the picture of victory at the end?"

Thune said he'll be discussing options with senators in the days ahead: "If somebody can show me how we get an outcome, how we get a result, how we get an answer to this, I'm all for it."

Op-Ed of the Day: On Corporate Tax Revenues

Corporate tax revenues have fallen 28% since the Republican tax bill was passed last summer, and that points to a long-running problem that is calling out for a fix, Bloomberg columnist Justin Fox says Monday.

"This was an expected consequence of the law's provisions that allow businesses to fully expense spending on research and development, equipment and some other investments rather than writing them off over several years, and it will be reversed to some extent as those write-offs aren't taken on future tax returns," Fox writes. "But the decline highlights the narrowing and fragility of a tax that used to be a significant pillar of US government finances and now really isn't."

After World War II, corporate taxes provided about a third of federal revenue, but that has fallen to about 7%, Fox says. Measured as a percentage of the economy, corporate taxes represented about 6% of gross domestic product; that has fallen to about 1.5%. Meanwhile, corporate profits have risen to record highs, with pre-tax profits equaling 13.9% of GDP in the first quarter of 2026, and post-tax profits equaling 11.4%.

Fox argues that the combination of record-high corporate profits, historically low corporate tax revenues and "yawning fiscal imbalances" in the federal budget call out for major reform. He highlights a new proposal published by economists at the center-left Brookings Institution to shift the U.S. corporate tax from an income tax to a cash-flow tax. The plan would raise an estimated $4.7 trillion over 10 years. Fox says the proposal is similar to one offered in 2016 by Republicans Paul Ryan and Kevin Brady, though with some key differences.

Fox admits that a major, bipartisan overhaul of the tax system is unlikely politically at the moment, however much it may be needed, and there would likely be enormous resistance to making significant changes that would necessarily affect the whole economy. But he notes what veteran tax policy analyst William Gale, one of the authors of the new Brookings plan, once said: "There doesn't seem to be any politically feasible situation out there right now. That doesn't mean there won't ever be a politically feasible situation. It just means that when one comes along, it will be something that's currently considered to be impossible."

bloomberg_corporate_tax

Fiscal News Roundup

Views and Analysis