Trump's 'blizzard of lies' suggests GOP facing 'very ugly' midterm: Nobel economist
Adam Lynch
Nobel Laureate Paul Krugman said the purpose of President Donald Trump’s speech was to turn around Trump’s "cratering public approval" on his handling of the economy, but all it really did was outline the cliff waiting for Republicans next year as the president fails to deliver meaningful improvements for Americans.
“It was a blizzard of lies,” said Krugman. “I can’t find a single factual assertion Trump made that was true.”
But lies, boasts and tearing down Joe Biden’s legacy won’t send voters to the polls for Republicans, said Krugman. Take Trump’s persistent claim “that the world despised the US economy a year ago and now admires his achievements.”
“One year ago, our country was dead. We were absolutely dead. Our country was ready to fail. Totally fail. Now we’re the hottest country anywhere in the world. And that’s said by every single leader that I’ve spoken to over the last five months,” Trump claimed, in spite of headlines in October 2024 proclaiming “The American economy has left other rich countries in the dust.”
Krugman said Trump also filled his speech with false claims that overall prices are coming down, using turkeys, eggs and gasoline as examples, despite his policies having very little influence over the price of these items.
“Egg prices, for example, fluctuate wildly over time, not because of anything the government does, but because of the vagaries of bird flu,” Krugman said, adding that the latest report on consumer prices showing lower inflation than expected “was seriously distorted by the effects of the government shutdown,” according to other economists.
This leaves Krugman’s “best guess” to be “that troubling inflation, and with it public concern about affordability, will persist.”
Healthcare, meanwhile, is about to explode in cost and Republicans and Trump keep refusing to do anything about it, Krugman wrote. Trump claimed he would replace current Obamacare subsidies with a different kind of subsidy system, but Krugman said congressional Republicans "will never approve subsidies adequate to make health insurance affordable” and “because the Republican plan would be far stingier than the one currently in place [and] millions of people will be forced to drop their insurance.”
This means younger and relatively more healthy people will drop their coverage, and leave the pool filled with older and sicker people who will raise premiums even further.
“But leaving the short-run politics aside, the speech revealed something important: Namely, Trump has no idea how to govern,” Krugman said. “Faced with adversity, he’s unable to propose policies to improve the situation. All he can do is continue to gaslight the public and claim that everything is great, while smearing his opponents.”
“That was a short speech, but it presages a very long next three years for ordinary Americans,” Krugman said. “And for congressional Republicans, it presages a very ugly November 2026.”
Read Krugman’s column at his Substack here.
Adam Lynch
December 19, 2025
ALTERNET
Nobel Laureate Paul Krugman said the purpose of President Donald Trump’s speech was to turn around Trump’s "cratering public approval" on his handling of the economy, but all it really did was outline the cliff waiting for Republicans next year as the president fails to deliver meaningful improvements for Americans.
“It was a blizzard of lies,” said Krugman. “I can’t find a single factual assertion Trump made that was true.”
But lies, boasts and tearing down Joe Biden’s legacy won’t send voters to the polls for Republicans, said Krugman. Take Trump’s persistent claim “that the world despised the US economy a year ago and now admires his achievements.”
“One year ago, our country was dead. We were absolutely dead. Our country was ready to fail. Totally fail. Now we’re the hottest country anywhere in the world. And that’s said by every single leader that I’ve spoken to over the last five months,” Trump claimed, in spite of headlines in October 2024 proclaiming “The American economy has left other rich countries in the dust.”
Krugman said Trump also filled his speech with false claims that overall prices are coming down, using turkeys, eggs and gasoline as examples, despite his policies having very little influence over the price of these items.
“Egg prices, for example, fluctuate wildly over time, not because of anything the government does, but because of the vagaries of bird flu,” Krugman said, adding that the latest report on consumer prices showing lower inflation than expected “was seriously distorted by the effects of the government shutdown,” according to other economists.
This leaves Krugman’s “best guess” to be “that troubling inflation, and with it public concern about affordability, will persist.”
Healthcare, meanwhile, is about to explode in cost and Republicans and Trump keep refusing to do anything about it, Krugman wrote. Trump claimed he would replace current Obamacare subsidies with a different kind of subsidy system, but Krugman said congressional Republicans "will never approve subsidies adequate to make health insurance affordable” and “because the Republican plan would be far stingier than the one currently in place [and] millions of people will be forced to drop their insurance.”
This means younger and relatively more healthy people will drop their coverage, and leave the pool filled with older and sicker people who will raise premiums even further.
“But leaving the short-run politics aside, the speech revealed something important: Namely, Trump has no idea how to govern,” Krugman said. “Faced with adversity, he’s unable to propose policies to improve the situation. All he can do is continue to gaslight the public and claim that everything is great, while smearing his opponents.”
“That was a short speech, but it presages a very long next three years for ordinary Americans,” Krugman said. “And for congressional Republicans, it presages a very ugly November 2026.”
Read Krugman’s column at his Substack here.
Discussing the post-2008 financial rules, Trump’s Treasury chief told a Fox host that “we have to take the financial system out of this straitjacket.”
US Sen. Elizabeth Warren (D-Mass.) speaks to reporters following a vote on Capitol Hill in Washington, DC on November 9, 2025.
(Photo by Anna Rose Layden/Getty Images)
Jessica Corbett
Dec 17, 2025
COMMON DREAMS
President Donald Trump’s administration “wants to turn the clock back to 2008 and let Wall Street run wild.”
That’s how US Sen. Elizabeth Warren (D-Mass.) responded on Wednesday to Treasury Secretary Scott Bessent’s comments to Fox Business Network host Maria Bartiromo about the administration’s deregulatory push.
Without naming it, Bessent took aim at the Dodd-Frank Wall Street Reform and Consumer Protection Act, a 2010 law that Warren, then a longtime Harvard University professor, fought for in the wake of the 2008 financial crisis.
Recalling that era, Warren said: “We all know how that ended—with taxpayers bailing out Wall Street while millions lost their homes and got fired from their jobs. Donald Trump could be setting the stage for the next crash.”
Warren was far from alone in calling out Bessent after journalist Aaron Rupar noted that during the Fox interview, the ex-hedge fund manager said: “I chair something called FSOC, the Financial Stability Oversight Council, and these 2008, 2009, 2010 financial rules were too tight. They have hamstrung the American financial system. It was time for a change. We’re gonna be safe, smart, and sound in terms of our deregulation. But we have to take the financial system out of this straitjacket.”
University of Michigan business law professor Jeremy Kress said: “Fact check: The decade following the Dodd-Frank Act marked the longest period of economic growth in US history. The main problem with the post-2008 reforms is that they did not do nearly enough to limit the nonbank risk-taking that Bessent and his allies have enabled.”
Progressive political commentator and YouTuber Kyle Kulinski declared, “These people are hell-bent on creating a new Great Depression.”
Dean Baker, senior economist at the Center for Economic and Policy Research, said, “Remember BLEAT: Bessent Lies about Everything All the Time.”
The Fox appearance on Tuesday came after Bessent earlier this month announced an overhaul to the structure of FSOC—which was established by Dodd-Frank—and wrote in the introduction letter to the council’s annual report that it “would shift its focus from ‘prophylactic’ regulatory and supervisory policies to an approach aimed at removing red tape in areas like artificial intelligence, in a bid to spur economic growth,” as Politico summarized at the time.
As Politico also reported:
Markets groups and members of Congress expressed their concern over the changes. In a letter to Bessent... Sen. Elizabeth Warren (D-Mass.) expressed concern that the FSOC has met fewer times this year than in any past year of its existence and that the council is “sabotaging its own authorities.” Dennis Kelleher, CEO of Better Markets, an advocacy group focused on regulation, stated that “undermining the FSOC is undermining the economy and the financial system.”
Sharing the Politico report on social media earlier this month, Kress said that “this is a dereliction of duty by the Financial Stability Oversight Council. But if there is a silver lining, it is that the Trump administration now unequivocally owns whatever crisis lies ahead.”
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