The US economy has grown at a rate of 2.2% in the past year under President Donald Trump’s leadership. However, his economic agenda was more ambitious, including trade and immigration policies. But have these policies achieved their intended goals? Economist Adam Tooze explores this with FP deputy editor Cameron Abadi.
Tooze argues that there is no contradiction between inflation and affordability. Inflation measures the rate of change in prices, while affordability refers to a state or condition. The recent decline in inflation rates has not necessarily led to an increase in affordability for Americans. In fact, the real wage has increased, especially for lower-income Americans, due to labor market recovery after COVID.
Tooze also discusses Trump’s immigration policy, which aimed to reduce demand for housing by deporting undocumented immigrants. However, the impact on the labor market is not significant, and it mainly affects sectors like agriculture and construction that rely heavily on undocumented workers. Additionally, tariffs imposed by the US have led to higher prices for imported goods, hurting American consumers and businesses.
The economist also touches on corruption in the Trump administration’s policies. While short-term effects may be limited, long-term consequences are expected to include inefficiencies, misallocation of capital, and erosion of institutional trust. However, in the short term, corruption can facilitate business growth by providing connections and speeding up processes.
Tooze concludes that understanding the complex relationships between inflation, affordability, immigration policies, tariffs, and corruption requires a nuanced approach. As the US economy continues to evolve, it is essential to carefully evaluate the impact of these policies on the country’s growth and development.
Note: The article has been edited for clarity, length, and simplicity to make it easier to understand for a broader audience.
Source: https://foreignpolicy.com/2026/02/20/trump-economy-one-year-later