Trump's article of faith: Economy will soar in '26
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President Trump arrives to speak last week in Mount Pocono, Pa. Photo: Jonathan Ernst/Reuters
President Trump and his advisers have an almost messianic belief the economy will take off in the first quarter of next year, based largely on stimulus from the "One Big Beautiful Bill" he signed in July.
- For the White House, it's an article of faith.
Why it matters: Trump's bullish belief is key to understanding why he's so reluctant to say there's an "affordability crisis." He calls that talk a "hoax" and a "con job," advisers say, because the problem didn't start under him and the economy is growing steadily.
- "It's a conundrum," said one Trump adviser who has discussed messaging with the president. "He doesn't want to say 'affordability.' That's different than not wanting to talk about it."
Zoom in: Both inside and outside the White House, Trump advisers are pinning their hopes on projections by Treasury Secretary Scott Bessent that Americans' finances and outlook will improve markedly during tax season:
- The "refund boom": Working Americans could see as much as $2,000 in returns from the IRS during tax filing season because of the tax-and-spending bill. It extended Trump's 2017 tax cuts and gives new write-offs to some tip earners, Social Security recipients, overtime workers and parents, Bessent said last week.
- Capital expenditures: Businesses can write these off, retroactive to Inauguration Day, providing more incentives to hire and raise wages. The administration says the expenditures have increased 15% since January. Independent analysts say it's closer to 8%, still strong.
- Stocks: Most strategists expect markets, which soared this year, to go even higher in 2026, largely because of AI giants that have Trump's hearty backing.
Zoom out: Along with hoped-for reductions in inflation, lower interest rates and (continued) lower gas prices, Trump and his inner circle are counting on citizens benefiting from money-saving initiatives, from lax fuel economy standards to his prescription drug plans to sweeping deregulation.
- "The sky-is-falling crowd is just wrong," the Trump adviser said.
- The economy is "going to take off like a rocket ship," said another.
Reality check: Trump, a former developer and reality-show host, is a natural salesman who casts his policies in the most favorable terms — and believes in the power of positive thinking.
- But his tariffs have driven up some prices, which he has tried to mitigate by rolling back import levies on coffee and beef.
- And there are plenty of skeptics about the stability of the stock market, or the impact of no tax on tips, Social Security or overtime.
Behind the scenes: Beneath the upbeat tone, some in the White House are frustrated Trump isn't getting more credit for indicators that historically would be cause for celebration, or at least calm:
- Real wages are up by about 1% percent since Trump took office.
- Inflation is running around 3% and unemployment is under 4.5%.
Yes, but: Try telling that to people who are adamant they're paying more for groceries and electricity (as AP and NBC polls found in the past week), and think Trump's gaslighting them on the economy by making things sound better than they are (a memorable result of a CBS News/YouGov poll last month).
- Affordable Care Act subsidies for 22 million middle-income Americans are also set to expire, which could create further headwinds.
Friction point: In his first affordability speech in Pennsylvania on Wednesday, Trump stepped all over his message with asides about "sh*thole countries," railing against alleged Somalian welfare frauds and calling his predecessor as "sleepy" and "corrupt."
- "If I read what was on the Teleprompter, you'd all be falling asleep right now," Trump said at one point. He also called the discussion about affordability a "hoax" because it doesn't account for the increased purchasing power people now have.
- "I can't say 'affordability hoax' ... because they'll misconstrue that," Trump said. He's also called it a "con job."
- Trump's adviser said: "What he's calling a con job is the word 'affordability' and the way it's being used."
What's next: Trump plans a nationwide address soon to cap off his first year in office. He'll hit the campaign trail ahead of the 2026 midterms and talk about affordability — but in his way.
- Another Trump adviser said the president "is who he is, and it's why he won. ... And next year, when the economy is taking off, we're going to say we told you so."
Axios' Ben Berkowitz contributed to this report.
