Amid widespread, flagrant corruption happening throughout the government, Donald Trump is trying to impose a gag order on everyone who works in the executive branch.

Every. Single. Person.

This week, the Trump administration proposed a rule for a uniform, government-wide nondisclosure agreement. The draft version of the NDA is supposed to be opted into agency by agency. And while it says signing is “voluntary,” it concludes with a warning that employees can be fired and barred from future government jobs if they do not do so.1 The gag orders would be effective even after civil servants have left government employment—for five years post-departure—and violations come with the threat of criminal charges.

In short, in all but name it would be a loyalty oath to Trump.

Government workers are already bound by strict legal prohibitions against disclosing things like classified or privileged information, personal tax records, and other private administrative data. This vaguely written NDA, by contrast, would bar disclosure of all “non-public, confidential, or proprietary information” or “any sensitive, pre-decisional or deliberative material” that’s not already publicly available and shouldn’t be released under “applicable law.”

Which sounds quite a bit like: Don’t you dare say anything that might be unflattering to this president—or else.

Given the other things the administration has done to eliminate sources of accountability, this gag order seems designed to hide and ultimately enable even more law-breaking across our federal government. It’s among the more alarming documents the Trump administration has produced, once you understand the context. Stick with me as I explain why.

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NOT EVEN DONALD TRUMP’S FAVORITE BRANDS are safe from his economic abuse. Consider the case of Florsheim Shoes, which sells the black leather oxfords famously modeled by Trump’s cabinet members.

“The tariffs have changed fifteen times,” recounts Thomas Florsheim Jr., whose great-great-grandfather founded the brand in 1892. “I think that many businesses felt that the Trump administration was going to be pro-business. And, you know, with the tariff situation, somehow the pro-business thing got lost.”

Florsheim is CEO of Weyco Group, a publicly traded company based in Glendale, Wisconsin that sells several other footwear brands (including Nunn Bush and Stacy Adams) in addition to the family’s eponymous line. Today, Weyco employs about 350 people in the United States. These employees work in design, accounting, warehousing, IT, sales, marketing, logistics, customer service, and so on.

In other words, they do pretty much everything you can think of related to selling shoes except physically manufacture them.

That’s because Weyco shoes, like 99 percent of the footwear sold in this country, are made abroad.1 Virtually the entire industry shifted overseas decades ago, and it is not coming back. Shoe manufacturing is relatively low on the value chain and requires demanding, labor-intensive work, which makes it prohibitively expensive at U.S. wages.

“You really can’t make shoes and sell them in the U.S. unless you want to sell shoes for more than $300,” he says. Florsheim shoes typically retail at less than half that price.

Which is why the whole tariff thing has been so frustrating. Trump’s trade wars have jeopardized the jobs of the hundreds of Americans whom Weyco actually does employ, in those twenty-first-century jobs that the United States excels at creating. And it’s not clear why domestically manufactured wingtips or penny loafers would be of critical strategic interest to U.S. national security, anyway.

Yet at times over the past year, overall tariffs on Weyco shoes reached as high as 161 percent. Which adds up. Over the ten months following “Liberation Day,” Weyco paid the government roughly $21 million in import duties. Florsheim was able to pass along a relatively small proportion of those costs to customers, raising prices just once by 10 percent. His options were limited both because (1) Weyco was already locked into a spring price list for its retailer clients long before Liberation Day, and (2) consumers wouldn’t tolerate price increases much higher than 10 percent. Beyond that point, the company risked losing sales entirely.

Last December, Weyco got hit with a surprise tariff bill for over $1 million. Thomas Florsheim decided he’d had enough.

His company sued the Trump administration, arguing

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IN ECONOMICS, THERE’S A CONCEPT called the “winner’s curse.” It means that the person who ends up winning an auction has often overpaid for the prize. It’s a good way of characterizing the fate of the newly confirmed Federal Reserve chair, Kevin Warsh.

Warsh has been auditioning to lead the Fed for over a decade now, muscling out competitors and massaging his public image. The main way Warsh finally got the gig was by pledging to cut interest rates, which was Donald Trump’s litmus test. Unfortunately for Warsh, he will not be able to deliver on that promise for reasons that are clear to everyone except, perhaps, Trump. This means that Warsh is hurtling toward a reckoning with his benefactor.

This is all related to the scary little chart right here:

Yesterday, for the first time since 2007, rates on new 30-year Treasury bonds surpassed 5 percent. And look, I realize that was possibly the most boring sentence you will read today.1 So let me explain what it means, why it matters to the economy, and why it suggests Warsh is very, very cooked.

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IT STARTS WITH TRUMP’S economic policy agenda.

Inflation had been drifting downward in recent years, at least roughly until “Liberation Day” in April 2025 when Trump announced global tariffs. The rate of price growth soon started ticking back upward.

Then the Iran war happened. And, as was evident in new reports this week on consumer and producer prices, inflation has been supercharged. With consumer prices reaching 3.8 percent growth in April from a year earlier, we’re likely seeing only the earliest glimmers of the war’s effects on prices for energy, food, manufactured goods, and so forth.

Even worse, this one-two punch of tariffs and war threatens to reset expectations for how bad inflation will get. What this means is that instead of these shocks being temporary (dare I say “transitory”), we could be at the start of a vicious cycle in which companies that are fearful of getting surprised by higher prices in the future raise their own prices preemptively today. If everybody does this at once, you get more inflation. It’s a self-fulfilling prophecy.

Companies and consumers aren’t the only ones who worry about inflation. Anyone who lends to the government worries about it, too: They don’t want the interest they receive on those loans to get eaten up by inflation. They want to make money!

This brings us to the infamous 30-year bonds. This week, there was an auction for Treasuries, which are the debt instruments the U.S. government sells so it can pay its bills. And buyers demanded higher interest rates on that government debt as compensation for the very real risk that inflation will run higher for a while. They demanded it both for shorter-term Treasuries and longer-term ones, as well. That’s why you saw 30-year bonds selling at their highest yield in nearly two decades.

If those bonds stay around 5 percent (or higher), a few things can happen.

First, obviously, is that the debt load the government carries becomes more expensive. U.S. debt was already on an unsustainable path, given how much we spend vs. how much we collect in tax revenue. Higher interest rates make carrying that debt even more painful. The government already spends about as much on interest as it does on Medicare. If you’re worried about a fiscal doomsday clock, things like this bring us a few ticks closer to midnight.

Second is that financial conditions for the rest of the economy will remain tight.

Rates for mortgages, business loans, credit cards, car payments, and similar are all sensitive to what happens to rates for government debt. To be clear, most of the time, private debt rates are not mechanically pegged to the rate for a specific Treasury instrument. But in practice, they’re closely related, since Treasuries are supposed to be the safest, least-risky form of debt out there. Everything else gets benchmarked against them.

The more expensive it is to finance a home or a car, the angrier voters will be. This, in turn, will also make Trump mad. And all of this will hem in the Fed, which looks less credible if it’s slashing interest rates while markets are freaking out about inflation.

THIS BRINGS US to Warsh’s quandary. Warsh has said he intended to cut interest rates (specifically, the short-term rates that the Fed has the most control over). But with inflation rising, that objective is increasingly undesirable, or impossible—or both.

Markets have already communicated this: They don’t currently expect any additional cuts through at least the end of 2027. If anything, rate hikes are more likely, particularly next year.

And regardless of what markets are communicating, Warsh himself is primed to believe we need higher rates, too. He is widely known as an inflation hawk2—someone whose concerns about inflation push them to err more on the side of higher interest rates than making risky cuts.

But let’s assume he nonetheless still wants to deliver the rate cuts Trump expects. Guess what? He can’t.

For starters, Warsh will be only one of twelve votes on the Fed committee that sets interest rates, and the rest of the committee is making it clear they’re not interested in more cuts. So Warsh has no good options here.

He could try to convince the rest of the committee to cut rates. But he will almost certainly fail.3

Alternatively, he could watch everyone else vote to keep rates steady (or to raise them), and be a lone vote for cuts. That is, he could throw the rest of the Fed officials under the bus and proclaim to Trump that he really, really wanted to deliver rate cuts, but no one else would cooperate.

I cannot overstate how cuckoo that would be.

The chair’s job, for decades, has been to build consensus. Most of the time, the twelve-person voting committee votes unanimously, with the policy decision more or less pre-negotiated by the chair in advance. There are occasional dissents,4 but the idea of an open dissent by the sitting Fed chair is almost unheard of. The last time it happened was 1939.

Today, it would signal a significant breakdown in leadership. Warsh would look at best ineffectual, and at worst like the sockpuppet Democrats accused him of being when he refused to answer who won the 2020 election. It would be an act of self-humiliation.

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There is another option. Warsh could vote like the hawk that he is in his heart. He could put his name down for either steady or higher interest rates alongside his Fed colleagues. But in that case, he’d face Trump’s wrath—and, possibly, the same type of smears, threats of (illegal) termination, and bogus criminal investigations that Trump has flung not only at Warsh’s predecessor, Jerome Powell, but also at his fellow Fed governor Lisa Cook. For all we know, Trump’s henchman and housing appointee Bill Pulte has already begun amassing an oppo dossier on Warsh in preparation for precisely this scenario.5

If that were to happen, at least Warsh would have someone there to guide him through it. Cook remains on the Fed, awaiting a Supreme Court decision about her fate (though Pulte has recently insisted that if he can get an indictment against her it would prove legally sufficient to fire her from the post). Powell persists on the Fed Board, as well; he chose to stay on after his chairmanship ended as a bulwark for institutional independence. Perhaps just in case, ahem, anyone else at the bank goes wobbly.

Maybe Warsh thinks he can manage Trump. Maybe he thinks his marriage to the daughter of a close Trump ally6 will shield him from the full force of Trump’s rage and retribution. But other onetime confidants with even closer ties to MAGA’s paterfamilias have been shredded for less.

Congrats on your new gig, Mr. Chairman. Good luck to you.

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Ramparts

— The Goodyear tire plant in Fayetteville, North Carolina announced that it will close in 2027; roughly 1,700 people will lose their jobs.

— Perhaps another indicator of a softening labor market: Some big companies are cutting back on their paid leave policies. At one time there was something of an arms race, at least in the tech industry, to provide better and better fringe benefits, including family-related benefits (also fertility benefits, backup childcare, and much else). As the AI-pocalypse comes for tech and other professional services, we may see some of those benefits disappear.

— Speaking of victims of AI: Princeton just chucked its 133-year-old tradition of not proctoring exams and relying solely on a quaint notion called “students’ honor.” The reason: the sordid temptations of Claude.

— And speaking of the victims of AI and college students: The job market sucks for new grads. Or maybe for young people of all educational attainment levels? And why is it seemingly worse here in the States? New Gallup polling finds the United States is one of the few countries where younger workers are more pessimistic about their finances than older workers are; in fact we have the “largest gap of any country in job market perceptions between younger and older adults.”

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IN THE MIDST OF AN ENERGY CRISIS, the Trump administration is paying companies to not build more energy infrastructure.

You read that correctly.

The Trump administration is proudly shelling out almost $2 billion in exchange for agreements from developers to halt wind projects that were already in the works. These projects—wind farms off the coasts of New Jersey, New York, North Carolina, and California—would have generated enough electricity to power roughly 3-4 million households once they came online.

What pot of taxpayer money this payoff comes from, and whether the payoffs are even legal, remain open questions. Even lawmakers don’t know the answers. But these companies should probably count themselves lucky. They got paid to shut down, after all.1

Dozens of other renewable energy projects around the country have not received the same—forgive me—windfall. Instead, they’ve been canceled, stalled, or quietly snuffed out, with zero compensation. The list includes a gargantuan solar project in Nevada and more than 150 wind developments around the country, which collectively could have powered around 15 million homes.2 As a Heatmap headline declared: “Trump is getting away with murdering an American industry.”

Renewables are hardly Trump’s only victim. Our president is basically an economic serial killer, whacking firms left and right.

In addition to the intentional corporate executions—like the deliberate, gleeful “murders” of these wind projects—there are a great many Trump casualties that look more like manslaughter: companies the president is killing by accident, as with the recently departed Spirit Airlines (R.I.P.). The president simply doesn’t understand how his economic agenda of trade wars and hot wars might accidentally kill off already-weakened individual companies—or, in some cases, entire industries.

Just over a year into his second term, the economic landscape is littered with victims mangled by Trump’s agenda. Corporate bankruptcies last year rose to their highest level in over a decade. So join me, friends, for a stroll through the ‘America First’ Corporate Graveyard.

Time to Sell the Farm

Trump often boasts about how terrific he is for farmers. The data show otherwise. Farm bankruptcies rose 46 percent in 2025 from a year prior, and this year the number is expected to be even worse thanks to the Iran war.

Farmers have already lost core markets for staples like soybeans, as China stopped buying from America and turned instead to Brazil and Argentina. And now, U.S. farmers are having to absorb higher costs for diesel, fertilizer, and other key inputs thanks to the war. So their margins are getting hammered thin from both sides. Mass deportations and the cancellation of both domestic and foreign food aid programs have done the same.

Persistently high interest rates, necessitated in part by Trump’s inflationary policies, have weighed on farmers, too.

As with Spirit, Trump has attempted a bailout for farmers harmed by his own policies (euphemized as “unfair market disruptions”). So far this hasn’t done much to staunch the bleeding, though Trump has solicited their gratitude all the same.

Manufacturing a Recession

Throughout each of his presidential campaigns, Trump promised a manufacturing renaissance. This was never likely to happen, despite bipartisan nostalgia for a bygone U.S. manufacturing era. That’s largely because we are now a services-based economy. But a resurgence was especially unlikely given Trump’s specific brand of America First policies, which includes raising costs of the inputs that U.S. manufacturers buy while also closing off export markets where these same U.S. manufacturers hope to sell their products.

The result: There are approximately 80,000 fewer manufacturing jobs today than there were when Trump took office last year.3 Not coincidentally, steel prices here in the United States are about 40 percent higher than those in Western Europe. The increase in corporate bankruptcies last year was driven largely by industrial firms grappling with tariffs.

The sweeping Trump tariffs have been painful enough. But lately, they have been coupled with new stressors resulting from his war with Iran.

For example, aluminum prices are nearly double what they were a year ago, thanks to a combination of Trump’s tariffs; a shutdown at a U.S. aluminum supplier; and the closure of one of the world’s largest aluminum smelters, located near Abu Dhabi, which was struck by an Iranian missile.

This has hit auto companies especially hard. In an earnings call last week, Ford said it expected its commodity costs this year to reach $2 billion, twice its previous projection, primarily because of rising aluminum prices.

Other manufacturers are feeling the pinch, too: In its own earnings filing today, Whirlpool warned that the Iran war had “resulted in recession-level industry decline in the U.S.” As trade nerds may recall: Whirlpool was one of the very first beneficiaries of Trump’s trade wars in his first term, through his global washing-machine tariffs. The company and its workers initially celebrated—but then they were beset by a series of other “America First” policies (including those metal tariffs).

The Supreme Court’s decision in February striking down Trump’s separate, “national emergency” tariffs has provided little comfort to most U.S. manufacturers. That’s not only because the administration has dragged its feet on issuing rebates for those now-invalidated tariffs. The problem is also that many companies were permanently scarred by the business they lost from the tariffs in the first place, and the goodwill Trump frittered away with their customers abroad.

As Pamela Rees, the owner of a small, U.S.-based harp manufacturing company (and a loyal Bulwark reader), shared recently:

Businesses like mine may (or may not) get back tariff monies paid but here is what we don’t get back. When my domestic-based vendors increased their prices to me because of tariffs, I don’t get that difference back. When I lost sales (and we have lost so, so many) to our international competitors because our tariffed prices are not competitive in their countries (remember, tariff wars have two sides), I don’t get those sales back. And the good will my company had built all over the world for our products - how happy do you think potential customers are going to be to buy from me in the future? No - manufacturers have been and will continue to be vandalized by this Trump Trade War and this President.

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The Final Nail in the Coffin

Besides Spirit, several other big consumer-facing firms have also gone under during the Trump II era, such as QVC, Joann Fabrics, and Design Group Americas (a Joann supplier). As with Spirit, these business failures were not due solely to Trump’s actions; bankruptcies are rarely monocausal, and in these cases, the companies were weak to begin with.

But Trump policies were the final nail in the coffin. Spirit was already struggling, and then could not survive jet fuel prices that rose to double its prior projections, swamping its margins. QVC and Joann were both weak before Trump took office, having been displaced by newer online competitors. But higher costs from tariffs put even more pressure on their margins.4

It is, of course, hardly unprecedented for economic policy to kill companies. Republicans have (often accurately) described Democrats as doing this many times over the years, typically by overregulating disfavored firms or entire industries out of business. Again, sometimes this happens deliberately, and sometimes by accident. Renewable projects, for instance, have faced plenty of permitting issues in blue jurisdictions, too.

Either way, Republicans have not always been wrong when they accused Democrats of “picking winners and losers.” But now, they themselves have adopted the same tactic. It’s unfortunate—especially when they so often struggle to keep their chosen winners and losers straight.

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Ramparts

— Speaking of tariffs: The very first tariff refunds are supposed to be issued in a few days, per Customs and Border Protection. But no, sorry, you’re probably not going to see any of that money, at least if you’re a regular consumer. These refunds are for the “trade community.” And on Thursday, a federal trade court struck down yet another set of tariffs that the administration had put in place after SCOTUS smacked down the initial batch.

— The Department of Justice and the Commodity Futures Trading Commission are reportedly investigating a series of suspiciously timed trades in the oil market, per ABC News. What happens if the call is coming from inside the house (as it, uhh, appears to be)?

— Speaking of the DOJ: The New York City Bar Association is holding its annual White Collar Crime Conference next week. Every attorney from U.S. attorneys’ offices abruptly pulled out yesterday, without explanation. It’s not like they’re too busy prosecuting white-collar crime to attend. Federal white-collar criminal prosecutions fell to their lowest level on record last fiscal year.

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— Sen. Thom Tillis (R-N.C.) recently ended his blockade of Trump’s Fed appointees because he said the politically motivated investigation of outgoing chair Jerome Powell was over. Tillis even bragged that he had saved the integrity of the Fed by preventing Trump from further using the DOJ to take over the central bank so he could control interest rates. “The reason I decided to stand in the way of this bogus prosecution of Chairman Powell is not for the one position, but how they could systematically use that if they succeeded with the chair to take out enough Fed voting members . . . to where they could actually control the board outcome.” Well, he may wish to consult with Bill Pulte, the director of the Federal Housing Finance Agency, who said this week that he expects Federal Reserve Board governor Lisa Cook to be indicted, and that this indictment alone (with or without a conviction) would be sufficient to successfully remove her from office before her term ends. (Hat-tip to Wall Street Journal Fed reporter Nick Timiraos for catching.) this.

— Eli Lilly’s blockbuster diabetes drug Mounjaro just surpassed Merck’s cancer therapy Keytruda as the world’s best-selling medication. It’s a new era, boys and girls.

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EVERY TIME REP. JOSH GOTTHEIMER (D-N.J.) lands at Newark Airport, he gets mad. Not about how filthy the terminals are, or those dumb Uber airport surcharges, or even the notoriously pricey meals. No, what inspires the congressman’s wrath is all the pro–New York merch on display.

“Nothing pisses me off more than when I get off an airplane here at Newark . . . and in my face is often a row of shirts in a store screaming, ‘I Love New York.’ Really? We just landed in Jersey,” Gottheimer said Monday.

For Gottheimer, seeing promos for the other side of the Hudson is an intolerable burden. As are the many “I❤️NY” hats and snowglobes at the nearby Jon Bon Jovi rest-stop. (“Makes me want to spit out my coffee,” he said.) But Gottheimer has a solution: a new tax break. The congressman has proposed the “Jersey Pride Tax Credit,” a 25 percent tax credit for businesses that sell New Jersey–branded products in airports, train stations, and rest stops.

New Jersey often has a strange way of showing state pride.1 But in this case, Gottheimer is no oddity. The new fad among Democrats all over the country is trying to win over voters with bizarrely niche, costly, and sometimes regressive tax breaks.

Some are being introduced at the state level, others at the federal. For example, Georgia gubernatorial candidate Keisha Lance Bottoms wants to eliminate income taxes for teachers. Meanwhile Rep. Marie Gluesenkamp Perez (D-WA) wants to exempt cops from federal income taxes on the first $100,000 of their income.

In other words, via the tax code, Dems have sought out a thousand and one little voter payoffs.

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Well, actually, some of them aren’t so little: Sen. Cory Booker’s “Keep Your Pay Act” would eliminate all federal taxes on married-couple households making up to $75,000. Meanwhile, another potential 2028 hopeful, Sen. Chris Van Hollen (D-MD), has collaborated with several Senate colleagues (including Booker!) on a bill that would eliminate federal income taxes on households earning up to $92,000. This would mean wiping out all income tax obligations for about 60 percent of households, according to calculations done for me by both the Penn Wharton Budget Model and the Yale Budget Lab.2

Not to be outbid, California gubernatorial candidate, Democrat Katie Porter, said she would exempt families’ first $100,000 from (state) income taxes if elected.

The bespoke tax-break trend among Democrats is a shift from the days when the party was more inclined to emphasize funding ambitious domestic programs with robust, broader-based tax increases. And it is proof that…

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IF DONALD TRUMP HAS HIS WAY, America’s Worst Airline™ might soon become our national flagship carrier.

Yes, I’m talking about Spirit Airlines.

The ultra-low-cost carrier is going bust. It’s been in trouble for a while: It filed for Chapter 11 bankruptcy protection last summer, for the second time in less than a year, and is now facing the prospect of liquidation. That’s largely because it cannot survive the sky-high1 jet-fuel prices caused by Trump’s Iran war, which is expected to raise Spirit’s costs by an estimated $360 million this year. You can’t sell enough $40 fares to fill that hole in the balance sheet.

One solution Trump is considering? A bailout, on the taxpayer’s dime.

The Trump administration is considering dumping $500 million in taxpayer money into the struggling airline. In exchange, the government would receive warrants allowing it to take up to a 90 percent stake in the company.

“We’re thinking about doing it. Helping them out, meaning bailing them out. Or buying it. I think we just buy it,” Trump said in the Oval Office on Thursday evening. “We’d be getting it virtually debt-free. They have some good aircraft, some good assets, and when the price of oil goes down, we’d sell it for a profit. I’d love to be able to save those jobs. I’d love to be able to save an airline. I like having a lot of airlines so it’s competitive. . . . If we could get it for the right price, I’d do it.”

It’s not clear what value the government would be purchasing; when JetBlue unsuccessfully2 attempted to buy Spirit a few years ago, it said it wanted Spirit’s pilots and jets, not its business model.

Does Trump know he wouldn’t be able to keep the jets—with their non-reclinable seats with minimal legroom? Maybe?

His motivation, instead, appears

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KEVIN WARSH, DONALD TRUMP’S pick for Federal Reserve chair, had his confirmation hearing before the Senate Banking Committee yesterday. The hearing was held under the shadow of Trump’s ongoing efforts to persecute (and prosecute) the current Fed chair, Jerome Powell—a vendetta that simultaneously undermines both the rule of law and the nation’s long-term economic prospects.

It was Warsh’s chance to prove his commitment to independence, and he failed.

He gave plenty of lip service to Fed independence, but he actually needed to answer two specific questions:

1) Is Trump’s criminal investigation into Powell appropriate?

2) What would Warsh do if Trump threatened retribution against him for monetary policy decisions the president disliked?

Both questions are critical, given that Trump’s demands for interest rate cuts—and Warsh’s promise to deliver them—will almost inevitably come into conflict with the inflation stoked by Trump’s war in Iran. But Warsh answered neither. In fact, no one even bothered to ask him the second question.

Kevin Warsh’s “Evolution”

Unlike some of the other candidates Trump has considered for Fed jobs, Warsh is not obviously insane or incompetent. He’s not a clown, or a hack, or someone who makes easily falsifiable claims on TV. On paper, he looks like a terrific candidate. He is polished and fast on his feet, has market experience, and has even served on the Fed Board before (from 2006 to 2011, as an appointee of President George W. Bush). Plenty of people I respect have said he more than clears the bar.

But the question has never been whether Warsh has the brains for the job. It’s whether he has the spine for it. Which he will very much need, given who is in the White House.

As I’ve noted before, Warsh spent nearly his entire career advocating for policy positions the exact opposite of those that Trump demands today. Trump wants looser monetary policy, regardless of economic conditions. Trump even has affirmed that a commitment to cut interest rates immediately was a “litmus test” for anyone wanting his nomination to lead the Fed. But Warsh has generally been considered an inflation hawk, favoring tighter monetary policy with higher interest rates and a smaller Fed balance sheet.

Even in the deepest, darkest depths of the financial crisis—as in, literally one day after Lehman Brothers failed—Warsh said he was worried about inflation. Instead, we immediately experienced deflation.1

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Warsh has been fairly consistent about this positioning with two major exceptions: Each time Trump happened to be entering the White House. Less than two months before Trump was re-elected, Warsh chided the Fed for cutting interest rates. Warsh then reversed himself a few months later, when Trump just happened to be scouting out a new Fed chair.

The timing certainly smelled funny. Particularly given the fact that Warsh had been passed over for the Fed job before, in Trump’s first term, and had attributed his rejection then to the fact that he hadn’t said what Trump wanted to hear.

“My meeting with the president went on for a bit more than an hour, and he was transparent in his views,” Warsh told Simon Bowmaker in a 2023 interview for a forthcoming book (Fed Reckoning: Conversations on America’s Central Bank, due out in January 2027). “It was a very rigorous interview. He asked some very relevant questions, and I offered my best judgments. I left the interview, however, not overly enthused about my prospects for selection. I did not put my ambitions ahead of my principles.”

We don’t know if Warsh’s subsequent transformation from inflation hawk to dove was actually politically motivated. As Warsh said in Tuesday’s hearing, “My opinions change when the facts change.” That is certainly a reasonable approach, and words I hope to live by too.

What makes this latest conversion concerning, however, is how it overlays Trump’s efforts to politicize the Fed, and how Warsh has responded to those efforts.

Trump’s Attacks on Fed Independence

The central bank is supposed to be politically independent. The only way it can keep price growth in check is by being willing to take painful actions that politicians won’t, such as raising interest rates when the economy starts getting too hot—or taking away the “punch bowl” just when the party gets going, as the expression goes.

Politicians pretty much always want to put more booze in the punch bowl—i.e., lower interest rates—regardless of the long-term consequences for the economy. That is why countries where politicians control the money supply tend to have much worse inflationary outcomes.

This was a problem here in the United States too, in the 1970s, when Nixon leaned on the Fed chair to keep rates low. But ever since Paul Volcker helmed the central bank, the Fed has proved its willingness to do “whatever it takes” to crush inflation, no matter how unpopular, and it has aggressively guarded its independence in the process.

Presidents got the memo: However much they might gnash their teeth in private about Fed policy, they knew it was important to stay out of the bank’s way and let it do its thing.

At least until Trump got into office in 2017.

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Trump elevated Powell to Fed chair for a term beginning in early 2018, and within months he was already publicly berating Powell for not doing his bidding. Trump’s angry tweets and interviews about Powell were pretty shocking at the time, at least to us Fed watchers.

But now those early rage-tweets seem almost quaint. Trump has escalated from smearing Powell as an “enemy” of the United States to repeatedly threatening to fire him. Trump actually did try to fire another Fed governor, Lisa Cook, on unsubstantiated allegations that she committed mortgage fraud (this case is now before the Supreme Court). And now Trump’s Justice Department is conducting a politically motivated criminal investigation into Powell, ostensibly related to cost overruns on a building renovation.

The irony is that Powell’s term as Fed chair is already scheduled to end next month. Trump could have just waited him out. But our president cannot help but continue to harass, threaten, and punish his perceived personal enemies, even after a federal court tells him to lay off.

This has all backfired tremendously for Trump.

Retiring Sen. Thom Tillis (R-N.C.) has said he likes Warsh but will not advance any Fed appointments until the investigation into Powell is over. This actually means that Powell could remain leading the Fed for longer, since the law allows the chair to stick around until a replacement is named.2

Warsh Ducks the Issue

So where is Warsh in all this? Mostly silent. But at times, he has encouraged Trump’s bad behavior, at least when he was publicly auditioning for the Fed job.

When asked last year about whether it was appropriate for Trump to publicly jawbone the Fed, Warsh defended Trump’s behavior, and said Fed officials must not be “pampered princes.”

Likewise, when every living former Fed chair signed a Supreme Court amicus brief warning of the dire economic consequences should Trump succeed in firing Cook, Warsh mocked them. “I did not know that senior economic officials’ at the Treasury and the Federal Reserve expertise went all the way to constitutional jurisprudence,” he snarked.

And then came yesterday’s confirmation hearing.

Sen. Angela Alsobrooks (D-Md.) asked Warsh if he would “commit to defending Governor Cook’s tenure as Chairman Powell has done.” She also quoted Supreme Court Justice Brett Kavanaugh as saying that Cook’s firing “would weaken, if not shatter, the independence of the Federal Reserve,” and asked Warsh if he agreed.

Alsobrooks then asked about the criminal investigation into Powell, and asked Warsh if he disputed Powell’s assertion that the investigation and threats of criminal charges are pretexts for disagreements over the Fed’s interest-rate policy.

Warsh refused to answer any of these questions. His rationales (or excuses) were some combination of: he shouldn’t comment on ongoing litigation before the Supreme Court; he trusts the courts; and though he “took a constitutional law class,” he lacks the legal expertise to weigh in.

This was a test, and Warsh failed it. And he knows it. In 2023, in that interview with Simon Bowmaker, Warsh said he had conveyed to the first Trump administration that he would not cooperate with any effort to remove Fed officials over policy disagreements:

Bowmaker: In Nick Timiraos’s recent book, Trillion Dollar Triage, he wrote that at a White House signing ceremony in January 2020, President Trump told you, “I would have been very happy with you [as Fed chair].” What would you have done differently if you had been Fed chair in the 2018–19 period?

Warsh: If you are referencing media reports that the president had grown unhappy with the Fed chairman at certain points, recognize that the Federal Reserve chairman is appointed with a fixed term. If the president wanted to truncate that term and replace the Fed chairman, I suspect that is a case that would have ultimately been decided by the Supreme Court. During the period that you reference, I did hear on occasion from senior administration officials querying about my interest in the role of chairman of the Federal Reserve. My response was that the position was not open and would not be open until the chairman’s term was complete.

How things have changed.

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A Trump–Warsh Confrontation Is Coming

Now one might argue—as some of Warsh’s friends have said to me privately in recent months—that Warsh has to make unseemly rhetorical concessions to get the job. There’s no way around it.

This kind of slippery elision may just be the price of admission for the job. As is the expectation that Trump appointees refuse to acknowledge Trump lost the 2020 election. (When Sen. Elizabeth Warren asked Warsh about this on Tuesday, he also declined to answer.) Most charitably, we can say that however gross these kinds of comments seem, they don’t mean Warsh will do Trump’s bidding if he’s confirmed.

After all, Warsh understands markets, and he has waxed poetic about Fed independence in the past. What matters is how he plans to respond when (not if) Fed independence comes under pressure on his watch.

Unfortunately, in the hearing, Warsh was never asked how he would react if Trump were to, say, call Warsh an “enemy,” or launch a bullshit criminal investigation into him, or try to fire him, or otherwise take him to court. (At the recent Alfalfa dinner, Trump “joked” about suing Warsh if the Fed didn’t cut rates.) When faced with such an onslaught, Powell stood his ground. Would Warsh? We don’t know! He wasn’t asked.

Maybe Warsh thinks he can manage Trump. Certainly every other onetime Trump ally or appointee seems to believe they’re uniquely able to survive a disagreement with him. But smooth and well-connected as Warsh is,3 I am dubious he’ll be able to sweet-talk his way out of presidential wrath. That’s important, because a confrontation over interest rates between Trump and a Warsh-led Fed is starting to look inevitable.

Why? First: Warsh will be just one of twelve votes on the committee that sets interest rates; he can’t deliver them solo.

Second, markets don’t seem to think he’ll really want to. When Warsh was first announced as Trump’s nominee in January, long-term Treasury yields ticked up slightly—suggesting investors expect the Fed to become somewhat more hawkish under Warsh, despite Trump’s demands and Warsh’s recent dovish transformation.

Third, that market reaction occurred before Trump started bombing Iran, leading to severed global supply chains and higher prices.

Developments in the war have led markets to further downgrade the likelihood of big rate cuts this year. Maybe investors will be wrong—particularly if the energy shock leads to a recession—but at the very least, the Fed will be in an even trickier position than it was before the war. Even Treasury Secretary Scott Bessent recently said he’d “understand” if the Fed held off on further rate cuts for a bit while monitoring the war’s impact. If at some point all the Fed’s internal models suggest inflation risks are high and rate hikes are necessary, but at the same time Trump is screaming for rate cuts because he wants to survive the midterms, how will Warsh react?

Senators should have asked that. Warsh should have to answer. Because the public deserves to know.

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WHEN YOU CAN’T OFFER SOLUTIONS, just blame corporate greed. Democrats wrote this playbook, and now the Trump administration has adopted it.

Donald Trump’s war with Iran has disrupted global supply chains. Oil, natural gas, fertilizer, aluminum, helium, plastics, and other commodities that usually transit the Strait of Hormuz were blockaded first by the Iranian navy and then by the U.S. navy too. Additionally, infrastructure around the Persian Gulf has been destroyed, suggesting that even when the blockade(s) end, production won’t resume as normal.

As a result, prices have surged. U.S. gasoline prices just rose at their highest monthly pace on record. Fertilizer prices have spiked too, which will eventually lead to much higher food prices. And voters are big mad.

The Trump administration and its allies have cycled through various deflections and excuses for this mess. Maybe the price increases are temporary, unconcerning, or not that bad. Or, wait—if they are bad, they’re probably Democrats’ fault. Or maybe they’re a small sacrifice to pay for [insert whatever our objective is in Iran].

And now, Republicans are getting around to greedflation. Over the weekend, Trump preemptively criticized fertilizer manufacturers for “price gouging,” an ill-defined, catch-all term meaning ‘prices that are higher than politicians think they should be’:

U.S. Department of Agriculture officials have already begun working with antitrust officials at the Federal Trade Commission and the Department of Justice to investigate whether anticompetitive behavior is driving high costs for fertilizer, machinery, and other inputs farmers buy, Bloomberg reports.

Similarly, Treasury Secretary Scott Bessent said on Wednesday that “We’ll be looking at Treasury to keep the retail gas stations honest. ‘You did this on the way up, you better be doing this on the way down,’” he said, gesturing up and down to indicate rising and falling prices. “And I’m sure the president will call out anybody who’s a bad actor.”

Trump, an icon of the Greed Is Good era who generally has a light touch when it comes to antitrust enforcement,1 appears to be blaming greedy corporations for high prices and prescribing antitrust-related remedies. So let’s consider whether there are merits to this logic.

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LET’S START WITH THE BASICS: Is more competition a good thing? Sure. I’m generally in favor of more aggressive antitrust enforcement (certainly more aggressive than the Trump administration has been to date). But as others have observed, promoting competition is like diet and exercise: good in the long run, but unlikely to solve acute crises.2

And right now we’re in an acute crisis, in the form of a massive supply shock. Whenever there are temporary supply disruptions you should expect short-run increases in prices—and often increases in profit margins as well, which can look “greedy.”

But let’s be clear: The cause of all this is the war; the cause is the closure of the Strait of Hormuz; the cause is Trump.3

What’s more, while the U.S. fertilizer industry is pretty concentrated, the retail gas industry is not. Most of the more than 100,000 gas stations around the country are owned by independent operators, competition is cut-throat, and most operators sell gasoline on razor-thin margins. (The slushies, beef jerkies, and other convenience-store wares are much higher margin.)

None of this is going to stop Trump from fruitlessly jawboning gasoline and fertilizer companies about how they should cut prices, even when doing so is against their economic interest—just as it didn’t stop him from jawboning companies not to raise prices in response to his tariffs.

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ALL OF THIS SHOULD BE A LAYUP for Democrats: Look at the silly things Trump is saying to deflect from his price increases! The challenge, of course, is that Democrats have themselves used nearly identical silly rhetoric too.

They did it when prices surged circa 2021 to 2023, for similar reasons: a COVID-era mismatch between constrained supply and strong demand. In that case, the supply issues were caused by the pandemic and not of Democrats’ making (unlike with today’s supply-chain problems related to Trump’s war). But . . . Biden and the Democrats did boost aggregate demand in ways that made the inflation problem a bit worse than it might otherwise have been, at least on the margin.4

Something similar happened with the great eggflation crisis of 2024. That was also caused by a sudden supply shock (bird flu forcing farmers to cull their flocks).5

But rather than offering boring, technical explanations about supply and demand (which might in some circumstances implicate specific policy decisions), politicians have decided that it’s more politically useful to blame greedy corporations. Both parties do this: Both the Biden and Trump administrations presided over antitrust investigations of Big Egg, and both railed against gas stations for raising prices.

And you can go back much further: There’s a storied history of presidents (and lawmakers) demanding FTC investigations when gas prices rise due to a supply shock, and then not finding anything.

None of which is to say that companies never collude to set prices beyond where market pressures would align them; there are real cases of illegal and anticompetitive behavior (like outright price-fixing); when there is legitimate reason to suspect that’s what’s going on, those firms should be investigated and held accountable.

But when it comes to inflation, if presidents feel the need to Do Something about high prices, launching a performative antitrust investigation is a cheap, easy option, one with seemingly little political cost. Same with yelling about greed, price-gouging, profiteering, and other vague sins that the public loves to hate. The risk in this approach is that none of these actions will actually fix the pricing problem—and so the president just ends up looking ineffectual in the process.

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Ramparts

— Given that those rising fertilizer prices are expected to feed into food prices soon, it’s maybe not the best idea for the Trump administration to propose cuts to nutritional assistance for low-income pregnant women, moms, babies, and toddlers.

— The U.S. fertility rate just hit a record low. This has major cultural, political, and economic implications worth exploring in a future newsletter. In the meantime, you can read JVL’s opus on the subject, from a little over a decade ago.

— Greedflation isn’t the only au courant example of horseshoe theory: Another is data centers. Red and blue states alike around the country are banning them (or considering doing so). The Democratic candidate for Texas agricultural commissioner also recently tweeted that AI data centers cause “chickens to lay 50% less eggs,” among other MAHA-esque claims. Incidentally I heard similar livestock-centric objections to wind farm developments when I reported on that subject in Kansas a few years ago.

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A LOT OF PEOPLE ARE GETTING RICH off the Trump presidency. Donald Trump himself tops the list, of course, but it also includes his kids and in-laws; other grifting nepo-babies; cabinet members (as well as their staff and children), senior aides; and other well-connected friends, investors, and firms.

You know who isn’t on that list?

You.

Yes, you, dear reader—at least assuming you’re not among the small community of courtiers sucking public funds dry. Instead, in virtually every way imaginable, Trump has made it easier for all those insiders to profit and, in turn, rip you off. If you bet on or invest in anything Trump might influence and you don’t have inside information, you’re a chump.

As the expression goes: If you’re not at the table, you’re on the menu.

The recent rash of curiously well-timed trades in prediction markets is one example of how those who have drawn up chairs to Trump’s banquet table appear to be feasting at public expense.

For example, there was the Polymarket account that banked over half a million dollars by betting on Iran strikes and the, ahem, departure of the ayatollah shortly before our military started dropping bombs. Other ‘lucky’ betting-market accounts, created right before the United States invaded Venezuela, engaged only in Venezuela-related bets, and somehow made perfect predictions every time, the Financial Times reported.

Similarly, just this week, a group of newly created Polymarket accounts “made highly specific, well-timed bets on whether the U.S. and Iran would reach a ceasefire on April 7,” Politico found.

These kinds of trades have raised concerns about not only insider-trading based on confidential or classified information, but also the incentives they create for as-yet-unmade decisions. How do we know officials are crafting policy based on what’s best for the national interest rather than what produces the biggest payday?

The risk of public fleecing based on private (or classified) data is not unique to prediction markets. There has been suspicious trading activity in more traditional financial markets, too.

Last month, minutes before Trump posted a market-moving post about his supposedly “productive” talks with Iran, someone (or someones, or some entity) placed bets worth half a billion dollars in oil markets.

“My gut from watching markets for the last 25 years is this is really abnormal,” a portfolio manager told the FT. “It’s Monday morning, there’s no important data today, there aren’t any Fed speakers you’d want to front run. It’s an unusually large trade for a day with no event risk. . . . Somebody just got a lot richer.”

This kind of insider trading is not some victimless crime. When traders front-run a market-moving Trump post, or a military announcement, or some other confidential or classified information, they’re taking money from all the other investors who didn’t have access to that inside information. Put another way: They’re taking money from your 401(k). Or your teachers’ pension funds. Or mom-and-pop investors. Again, all the chumps and suckers who don’t have a direct line to the president.

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Less white-collar enforcement, more eligible white-collar victims

OF COURSE, INSIDER TRADING antedates the Trump administration and has produced its fair share of political scandals in the past. But at least historically federal law enforcement usually tried to crack down on it, along with other white-collar crimes. That is . . . somewhat less true today.

Now, in fairness, Justice Department white-collar prosecutions have been trending downward more or less since the 1990s, with occasional spurts of enforcement (such as right after the 2008 financial crisis). But the Trump administration just hit an all-time low in white-collar prosecutions this past fiscal year, according to data from the Transactional Records Access Clearinghouse.

The Trump administration has dropped 145 major enforcement actions against corporations that it inherited from the Biden administration. And under Trump the head of the Department of Justice criminal division issued a directive last year to turn “a new page on white-collar and corporate enforcement” and divert more resources to bigger administration priorities, like immigration-law violations.

Trump has outlined the same approach through executive orders, including one that called for “fighting overcriminalization in federal regulations.” Another EO essentially adopted higher tolerance for the lucrative nexus between white-collar crime and international bribery—directing the DOJ to temporarily pause Foreign Corrupt Practices Act investigations and enforcement in order to develop a new strategy that safeguards “American economic competitiveness.” Trump has also been trying—with mixed success—to dismantle the entire Consumer Financial Protection Bureau.

Meanwhile, his administration has taken actions that would subject many more people to the riskier markets or predatory acts that these laws and agencies were meant to protect against. Last week the Labor Department proposed a new rule encouraging mom-and-pop investors to stash their 401(k) money in riskier “alternative” assets, such as crypto and private credit . . . right as the opaque and tenuous private credit market may be about to collapse.

Hey, when you run out of greater fools, it can be helpful to mint more of them. Someone needs to be left holding the bag.

Pardon Me

BUT TRUMP IS NOT MERELY content to block prosecutions of new fraudsters. He wants to clear the records of those already found guilty.

He has pardoned or commuted the sentences of dozens of people convicted of fraud and other financial crimes, such as Changpeng “CZ” Zhao, founder of the crypto exchange Binance1; Joseph Schwartz, a former nursing-home owner; Wanda Vázquez Garced, the former governor of Puerto Rico; former Rep. George Santos (R-N.Y.); EV startup founder Trevor Milton (represented by Pam Bondi’s brother); and billionaire former English football club owner Joe Lewis, who had previously pleaded guilty to insider trading charges.

“Over half of Trump’s 88 individual pardons are for white-collar offenses, with money laundering, bank fraud and wire fraud among the most frequent crimes the president has wiped clean,” according to an NBC News analysis from January.

NBC found that the 88 pardon recipients in 2025 had been ordered to pay more than $298 million in fines and restitution—and it’s unclear if the victims will ever receive it. Those being stiffed of their compensation include individual investors, as well as larger groups of victims such as the Oglala Sioux Tribe. (The Crime Victims Fund, created under Ronald Reagan in 1984, has been shortchanged, too.)

But the universe of victims is broader than the direct marks of the criminals whom Trump has pardoned. That’s because this kind of damage to the rule of law undermines faith in the broader market, by destroying trust that promised transactions or restitutions (including those put in place by our judicial system) will be honored.

As I wrote back in 2024, when some commentators argued that Trump’s felonious misrepresentations to banks and insurers were “victimless” crimes because those institutions still got their money in the end:

In a capitalist society, laws against fraud exist to protect not only the direct victims of fraud but also the overall integrity of the marketplace.

The reason we outlaw fraud, among other misbehavior, is to facilitate trust in business transactions. If I sign a contract to pay money in exchange for some service, I want to be confident that the promised service will be delivered. Or that if it isn’t, there will be legal consequences — regardless of the other party’s fame, wealth or political connections.

This level of trust, bolstered by the law, is why companies generally prefer to invest in the United States rather than a “Venezuela” or “Cuba.” The rule of law makes it easier to do business, not harder. The only people who benefit from the freedom to commit fraud are those who commit fraud.

Allowing well-connected sleazebags to lie and cheat hurts lenders, insurers, investors, customers, and others. But it also hurts the competitors of those sleazebags—and, in the long run, anyone else who happens to be engaging in commerce, too.

In this way, turning a blind eye to lawbreaking—whether via insider trading on classified information in newfangled prediction markets, or more traditional defrauding of investors or Uncle Sam—corrodes our markets because it encourages more lawbreaking.

It invites recidivism from those who’ve already been pardoned—as was the case with Adriana Camberos, who recently received her second grant of clemency from Trump (in January he pardoned her for a fraud unrelated to the fraud for which he released her from prison during his first term). But it also encourages more lawbreaking by everyone else. It compromises our democracy but also our collective morality. Because, after all, who wants to be the only chump left not cheating?

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Ramparts

— White House National Economic Council Director (and JVL’s favorite economist) Kevin Hassett predicts 4 to 5 percent GDP growth this year. Unfortunately that is roughly double what every major forecaster predicts, including the Blue Chip survey (1.9 percent); the Federal Reserve (2.4 percent); the Wall Street Journal survey of economic forecasters (2.1 percent); the Congressional Budget Office (2.2 percent, from February just before the war); the Financial Times/Clark Center survey (1.9 percent); and the OECD (2.1 percent). Maybe Hassett’s optimism will still win out, but he is not exactly known for his forecasting marksmanship. That said, he’s undershooting expectations from even more bullish Trump officials, like Commerce Secretary Howard Lutnick who was predicting 6 percent GDP growth just three months ago.

— Speaking of Trump economic advisers, Politico reports that the frontrunner to become chair of the White House Council of Economic Advisers is Chris Phelan, an adviser at the Federal Reserve Bank of Minneapolis. He looks to be a serious economist with an impressive C.V. I’m not totally sure why he’d want the job, but maybe he thinks his recent scholarship on strategic sovereign debt default will come in handy. (Let’s hope not?)

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— The Saudi government will soon be part owners of CNN and CBS, it seems. The Wall Street Journal, quoting “people familiar with the matter,” reports that the Saudi stake in the Paramount takeover of Warner Bros.-Discovery will likely not trigger a mandatory CFIUS or FCC review, which often accompanies a foreign entity gaining control of a significant U.S. business or media company.

— The White House budget proposes massive additional cuts to scientific agencies (including a 50 percent cut to both the National Science Foundation and the Environmental Protection Agency). Even the scientific areas that normally appear to be darlings of the Trump administration are unspared: AI research funding at the NSF, for example, would be cut by a third from its 2025 level.

— I wish we lived in a world where this kind of technological innovation was neither necessary nor profitable.

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I’M NOT SAYING DONALD TRUMP is trying to lose the midterms. But if he were, would he really be doing anything differently?

In recent days, the president has practically giftwrapped affordability-related oppo ads to Democrats via at least four channels:

• his war, and the resultant rising costs;

• his tone-deaf comments brushing off Americans’ concerns about rising prices;

• his proposal for (even more) safety-net cuts; and

• the gilded, marble-walled, money-making totems to Trump himself.

Any one of these things might be seen as political suicide in an election year. But all of them together, at once? It really starts to look like a deliberate plan to undermine his own party. Dems have a unique opportunity to (accurately) blame rising costs on Trump right now, and to shame him for his indifference to—at times, derision of—the pain he has caused. Will they take it?

Americans are big mad about the economy. So mad that they now miss the Biden economy, which trust me when I tell you they absolutely detested:

While some of this Debbie-Downerism may be “bad vibes,” real economic conditions do appear to be deteriorating. New data show that in February we had the lowest level of hiring since April 2020 (i.e., when the economy was shuttered due to COVID). Wholesale prices rose sharply in February as well. And those metrics were captured before Trump decided to start a war in the Middle East, which is making everything worse.

Crude prices spiked after Trump’s confusing and incoherent speech on the Iran war last night, in which he insisted that the Strait of Hormuz “will open up naturally.” Major measures of crude oil futures prices closed Thursday around 10 percent higher, at $110 per barrel; meanwhile “spot prices” for Brent crude reached a whopping $141, the highest level since the 2008 financial crisis.1

And of course the war hasn’t merely forced an oil crisis; we’re well on our way to an everything crisis, given the many supply chains disrupted by the strait’s closure.

Disruptions to fertilizer shipments and higher diesel prices are already raising food input costs. Fuel surcharges for shipments are lifting grocery prices, too. A global helium shortage is jeopardizing the AI boom, since helium is used to manufacture semiconductors (and has lots of other critical industrial applications, like MRI machines). Plastics prices are spiking too. And so on.

These disruptions won’t merely lead to higher prices; they are also boosting the risk of recession. That’s because higher energy costs (among other rising input costs) and lingering uncertainty effectively serve as a kind of tax on nearly all economic activity. Already Goldman Sachs estimates that the war is costing about 10,000 jobs a month.

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Trump’s other misguided economic policies (on trade, immigration, the Fed, etc.) are also compounding the warflation.

For example: aluminum smelters across the Middle East are closing down because of the war. Some have reportedly sustained damage from Iranian drones and missiles. But even if the war ended today, and if a shuttered facility had been completely unscathed by bombing, it can still take up to a year for an aluminum-smelting plant to restart operations. It’s not like flipping a switch.

But amid these developments, Trump has decided to increase the price of products made with aluminum.

Specifically, his administration is overhauling his existing steel and aluminum tariffs so that the tariffs will now apply to the entire value of a product that includes metal inputs, rather than just on the value of the steel or aluminum components alone.

Today is also the one-year anniversary of “Liberation Day,” when Trump announced global tariffs on adversaries, allies, and penguins alike. Even though the Supreme Court struck down those particular tariffs, the Trump administration is still refusing to issue refunds and working to reconstitute the stricken tariffs through other legal authorities.

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Trump Doesn’t Feel Your Pain

What is Trump’s response to concerns over the costs he’s imposed upon American consumers and businesses, via both his trade wars and actual wars?

He says it’s a sacrifice Americans must be willing to make, or, as he puts it, a “very small price to pay.” Maybe, he says, it’s even a good thing if oil prices rise, since America is home to big oil producers. And downstream companies shouldn’t care anyway about the costs: “You make enough money, it doesn’t matter to you, right?” he recently told farmers.

The words of a true political empath.

But it gets worse. Because while Trump is also giving us higher prices, he is also taking away programs to cushion the blow of those higher prices.

For instance, on Wednesday Trump said he directed his budget chief to stop sending states money for daycare because we need that money for wars instead:

Don’t send any money for daycare because the United States can’t take care of daycare, that has to be up to a state. We can’t take care of daycare. . . . We’re fighting wars, we can’t take care of daycare. You gotta let a state take care of daycare, and they should pay for it, too. . . . It’s not possible for us to take care of daycare, Medicaid, Medicare, all these individual things.

This is quite the midterm message: We can afford a billion-dollar-a-day war but not the popular safety-net programs that keep many American families afloat.

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Putting (Your) Money Where His Mouth Is

Lest you think this was merely an errant gaffe, Trump actually did try to freeze federal childcare funds sent to several blue states (though his efforts have been blocked by judges). And soon these spending priorities will soon be laid out nationwide, in black and white, in the White House budget.

Trump’s fiscal year 2027 budget, expected to be released Friday, “will frame his party’s midterm election message around a massive defense buildup, partially paid for by cuts to domestic agencies,” Bloomberg reports.

White House budgets rarely become law, and are usually seen as messaging documents. But on this particular set of fiscal choices, Trump may find a willing audience up on Capitol Hill.

Axios reports that House Republicans are currently weighing cuts to U.S. health programs to offset an additional $200 billion in spending on the Iran war and immigration. These cuts would be in addition to the $1 trillion+ cuts in Medicaid and SNAP that Republicans already passed in last year’s One Big Beautiful Bill, to pay for regressive tax reductions.

Those program cuts, coupled with the expiration of enhanced Obamacare premium subsidies that Republicans refused to re-up, have fed into Americans’ worries about health care affordability. In fact, new Gallup polling shows that health care leads Americans’ list of domestic concerns, with more respondents saying they worry “a great deal” about the “availability and affordability of healthcare” (61 percent) than said so about fifteen other domestic policy areas.

Trump’s timing here is pretty impeccable. The only way he could possibly appear more tone-deaf is if he were simultaneously spending hundreds of millions of dollars on a gilded White House ballroom and erecting a giant golden statue of himself in his presidential library/hotel.

Trump is worsening affordability while building himself a new Versailles—it’s a split screen that Democrats dream of.

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Ramparts

— In case you’re wondering if anyone is getting rich off of those Medicaid cuts, the answer is: Yes.

— It’s a strange state of the world when socialists are fantasizing about the rich getting (even) richer, but the New York City mayor’s office now finds itself doing just that after learning that the city’s finance professionals took in a bit less than expected last year. The city’s 2026 budget under Mayor Zohran Mamdani was counting on the average Wall Street bonus to soar an average of 15 percent above the prior year, but instead it rose “only” 6 percent (to $246,900). Tiny violins, I know; but this leaves an even bigger budget hole for the city to fill. That said, no one in government seems to have had a solid handle on how high the bonuses would climb: New York governor and self-described “staunch capitalist” Kathy Hochul’s office had projected that they would go up by 25.9 percent, resulting in an even larger budgetary hole at the state level.

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— A federal judge ruled that the Trump administration’s efforts to extract a list of Jews from the University of Pennsylvania were legally above-board. You may recall that Barnard got a similar demand last year, and complied. Penn says it is appealing the ruling. Meanwhile, a handful of states say the administration has defied a federal court order by continuing to share the private health information of millions of Americans with immigration officers. (I last wrote about all this, plus other examples of the administration’s abuse of confidential records and compilations of uncomfortable “lists,” back in January.)

— GLP-1s continue to rack up wins, with the latest being a demonstration of the drugs’ potential value for helping to treat psoriatic arthritis. One of my unpopular opinions is that people are probably overstating the medium-term economic impact of AI while underestimating the economic impact of GLP-1s.

— Happy Passover! RFK Jr. is bringing the plagues back.

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MOST PEOPLE THINK ABOUT the Federal Reserve as a dull, technocratic agency. If they think about it at all. Unlike other parts of government, the Fed isn’t trying to make headlines. They’re not trying to have viral moments.

Which is why it’s so weird that Fed Chair Jerome Powell has become something of a folk hero.

The John F. Kennedy Library Foundation announced last week that it would be honoring Powell with its Profile in Courage Award for “protecting the independence of the Federal Reserve . . . despite years of personal attacks and threats from the highest levels of government.”1

That’s a euphemism for: Trump launched a bogus criminal investigation into Powell to try to bully him into doing Trump’s bidding; and at great personal and professional risk, Powell stood his ground. This unlikely gallantry included some (yes) viral moments, such as a tense exchange with Trump on a hard-hatted tour of the Fed’s renovation project. And Powell’s dry-mouthed, direct-to-camera video, released late on a Sunday night, in which he revealed that the DOJ had threatened to criminally indict him.

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The Fed has not released a statement on the award, but confirmed to me that Powell will accept it, and will speak at the May ceremony where he’ll be honored.

For those of us who cover the Fed—as I have for almost two decades now—this has all been super weird. For a few reasons.

First, on the rare occasions that Fed news has gone viral before, it’s never been for anything good. At least I can’t think of anything comparable to this. If normies are sitting around discussing the Fed, and Fed officials are getting memed,2 something has usually gone very wrong for the economy, or monetary policy, or both.

Second, Powell does not want to be a leader of the Resistance. Central bankers are nerds who fiddle with interest rates. They sit around debating the value of r*.3 They’re not looking for political battles; in fact, they deliberately duck them, cognizant of the fact that the central bank needs to be politically independent in order to function.

By “politically independent,” I mean not just that Fed officials have to make decisions without regard to politicians’ preferences. They also must be perceived as operating entirely apart from politics. The public needs to believe the Fed is willing to do politically unpopular things, like hiking interest rates if necessary. That credibility—the mere belief that the Fed would willingly play bad cop—meant it rarely had to, and helped keep inflation low for decades.4

Powell doesn’t want to be viewed as a friend to Trump; and he also doesn’t want to be perceived as an enemy either. He wants to be seen, rightly, as a nothing to Trump.

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This situation is also super weird when you think about the kinds of people and temperaments the central bank tends to attract. The Fed is an institution that operates largely via consensus.5 Fed officials are generally not the kinds of personalities looking for public confrontation, or for opportunities to flaunt how brave they are. They’re not looking to win awards for “courage.”

Then again, maybe most people who truly deserve such awards aren’t those who seek them out. Winning an award for “courage” is like the moral equivalent of having a disease named after you. It’s nice to be recognized, I suppose, but maybe not worth going through what you had to go through to get it.

Just as Trump likes making apolitical things political, he also has a knack for forcing people to reveal either their courage or (too often) their cowardice. Powell’s choices have clearly resonated with the American public. If normie Americans are suddenly stans of a 73-year-old investment-banker-turned-technocrat, it’s because the country has been so starved of basic public virtue.

IF POWELL DESERVES OUR ADMIRATION, his presumed successor may soon warrant our pity: Trump has already put Kevin Warsh in a horrible position, and Warsh hasn’t even been confirmed yet.

Trump selected Warsh to succeed Powell as chair of the Fed when Powell’s term ends in May. A lifelong inflation hawk, Warsh nonetheless secured the nomination after declaring his intention to cut interest rates—something you don’t usually do when inflation is high. Trump had made clear this was a prerequisite for anyone wanting the job, after all.

But Trump is making it increasingly difficult for Warsh—assuming he’s ultimately confirmed6—to keep this pledge.

Even before the Iran war, inflation had been running stubbornly high, boosted in part by Trump’s trade wars. When inflation is elevated, that usually means the Fed wants tighter, not looser, monetary policy—i.e., higher interest rates.

And now, with the war disrupting oil markets (among many others), inflation is expected to rise even higher. The latest OECD Economic Outlook, released today, predicts U.S. inflation this year will be 4.2 percent. Meanwhile investors expect headline inflation to exceed 5 percent in the next twelve months.

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There is an ongoing debate as to how the Fed should think about this risk.

Normally, central bankers would be expected to “look through” a one-time energy shock and not worry too much about it feeding into ongoing inflation. In fact the Fed’s preferred inflation gauge excludes energy and food prices precisely because they’re so volatile.

But that’s not obviously the case now. This is not just an energy shock, it’s arguably an everything shock. And we’ve had five years of above-target inflation already. This raises the alarming question: What if businesses and workers start to expect broad-based price increases, and turn them into a self-fulfilling prophecy? If businesses expect higher prices for inputs, they could raise prices now—and voila, hypothetical future inflation becomes real, here-and-now inflation. The Fed would need to nip that in the bud.

Markets have already been pushing back their expectations for when the Fed will make its next rate cut, and some Fed officials, Powell included, have even suggested that the next move could well be a rate hike.

On the other hand, the U.S. economy has also shown serious signs of weakness lately. The Fed believes there’s been zero private-sector job growth over the past six months. The war is also raising the risk of recession. Maybe rate cuts, usually adopted during recessions, are a good idea after all?

This particular set of economic conditions would be challenging for any Fed leadership to make sense of. It’s genuinely hard to know what to do when you’re staring down the barrel of stagflation. But this will all be especially challenging for Warsh, who has promised to cut rates—and whom Trump has “joked” about suing if lower rates don’t materialize. Warsh and his Fed colleagues presumably also have to think about whether the public will view any rate cuts as an acquiescence to Trump (regardless of their actual rationale), and therefore a threat to that perceived independence of the Fed that I mentioned earlier.

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On the bright side, at least Warsh won’t have to make this decision alone. As I mentioned, interest rates are set not unilaterally by a chair, but by a twelve-person committee. And among those committee members may well be . . . Powell.

Last week Powell made an unusual announcement: Unlike nearly every Fed chair who preceded him, Powell said he had “no intention” of leaving the Fed Board, even after his term as chair ends in May—and will not depart at least until that bogus criminal investigation into him is over. Indeed, he says he may well stay even after the investigation is dropped, depending on what he judges to be best for the institution and the country.

Things may be super weird. But they’re also about to get super awkward.

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— Trump administration officials are reportedly modeling what a potential spike in oil prices to $200 a barrel could mean for the economy, Bloomberg reports. Maybe something they should have considered earlier?

— Relatedly: This past week has seen a brutal series of polls on the economy and Trump’s role in it. Just one example: Approval of Trump’s handling of the economy is at its lowest level across either of his terms as president—and lower than the measure was at any time during the Biden administration.

— Jed Kolko notes that “Miami is the new San Francisco,” in that it had the highest out-migration rate of all large metro areas last year.

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— Deutsche Bank has developed a “pressure index” for Trump,7 defined as a “proxy for upcoming rhetoric or strategic adjustments by the U.S. administration.” Its inputs are: one-month change in Trump’s approval ratings; one-year inflation expectations; and the performance of the S&P 500 and U.S Treasury yields. When the index gets higher, a TACO is supposed to be more likely to happen.

The problem is this measure kinda undermines itself. If it’s a good proxy, people will trade on it; its financial components (S&P, bonds) won’t gyrate as much because investors will anticipate the TACO and not freak out. But then the feedback loop that causes Trump to TACO gets short-circuited, and he doesn’t TACO because no market freakout forced him to.

What we want is probably something more like a positive feedback loop that causes Trump to TACO more. Normally shame might serve that function. But, you know.

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THE IRAN WAR HAS BROUGHT the dreaded r-word—recession—back into play amid a deeply fractured global energy market. To be clear, a massive downturn is not inevitable, nor can we even say it’s more likely than not. Recent surveys of economic forecasters place recession odds over the next year at about a third.

But those surveys were at least partly fielded before recent escalations in the war. And historically, oil shocks have preceded recessions in the United States (and elsewhere). So it’s worth walking through why this war and its resulting supply-chain disruptions have significantly raised the odds of recession—and what that outcome would actually look like. Buckle up. . .

The war isn’t just raising prices—it’s also slowing growth

Even before the war, the U.S. economy was showing serious signs of fragility.

Inflation has been above the Federal Reserve’s target of 2 percent for five years now, and Donald Trump’s trade wars have contributed to rapid price growth. For example, wholesale prices rose sharply in February (i.e., before the war began). Meanwhile, job growth has also sputtered; Fed Chair Jerome Powell said in a press conference Wednesday that if you adjust for what Fed staff thinks may be “overstatement” owing to methodological challenges, there has been effectively “zero net job creation in the private sector” over the past six months. And uncertainty (related to trade wars, regulatory changes, various rule-of-law-type risks) has also been a drag on economic growth.

That was the grim baseline prior to the war. Now layer on to those conditions a global oil shock.

Oil prices have been extremely volatile since the war started. Brent crude briefly surged above $119 per barrel on Thursday morning, then fell back and settled around $108. Fuels made from crude have become painfully expensive, with diesel prices nationwide now above $5 per gallon, and gasoline prices inching toward $4 per gallon. In much of the western United States, they’re already well above that milestone.

Jet fuel prices have likewise nearly doubled in the past month, leading to higher airline fares and canceled flights.

And needless to say, this is not only a U.S. story. Petroleum product prices have shot up even higher in Europe and Asia, leading to fuel hoarding and social unrest. The same holds true for liquefied natural gas prices, although the United States is relatively insulated from that hike because we produce so much LNG ourselves.

Obviously, high fuel prices are frustrating for consumers, who see billboard advertisements on their drive to work every day reminding them how expensive gas keeps getting. But fuel prices don’t just feed into inflation; they also have enormous consequences for global economic growth.

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TRUMP’S WAR OF CHOICE with Iran has many costs—in dollars, munitions, lives. But you could imagine at least one possible upside: climate.

This global oil crisis has again highlighted the riskiness of dependence on fossil fuels and the relative resilience of renewable energy. After all, naval blockades can stop oil tankers from traversing a narrow strait but they can’t keep the sun from shining or the wind from blowing.

We’d be more economically insulated if our country had built out more utility-scale solar projects, wind farms, batteries, and all the other clean-energy infrastructure that then-President Joe Biden subsidized and that Trump subsequently killed. Maybe this war will finally build more political will for green investment—not for bleeding-heart, tree-huggy reasons, but for our national and economic security.

You might assume all this. I initially did.

But, at least in the short term, it’s likely wrong. Instead, a sustained oil disruption could end up shattering the world’s attempts to curb climate change. That’s because it’s screwing up Europe’s ambitious climate plans, which are A) much more important than anything the United States is doing, and B) basically holding the global climate effort together.

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Europe is the key

When I started reporting out this newsletter, I thought it would be a good news/silver lining–type story. The headline I had in mind: “Trump’s Accidental Plan to Fight Climate Change.” After all, the war has already led to a shutdown of a fifth of the world’s oil supply, which is a keep-it-in-the-ground climate hawk’s dream.

The subsequent runup in energy costs has likely boosted some climate-friendly incentives elsewhere in the economy: The prospect of $4-a-gallon gasoline may get more Americans out buying EVs. Higher electricity prices might lead more people to persuade their HOAs to allow rooftop solar. And so on.

But those kinds of changes are small bore compared to what really matters—and what really matters right now is

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AHEAD OF THIS NOVEMBER’S MIDTERM ELECTIONS, the White House has reportedly grown worried about high consumer prices, particularly for fuel. Trump aides are now “looking under every rock for ideas on improving energy prices, especially gasoline prices,” per Politico.

Hmm. Have they perhaps tried not starting a war in the Middle East?

Until quite recently, oil and gasoline prices had been a bright spot in the affordability fight, registering modest price declines since Trump took office. But since we bombed Iran, energy costs have risen sharply. To put things in perspective: Oil prices are up about 20 percent so far just this week.

In other words: If Trump intended to start a war abroad to distract from problems at home, as some have proposed,1 he has instead made his domestic problems much worse. Trump’s “warflation” has just begun.

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The top crude oil expert at S&P Global Energy warned that the military conflict has the potential to become “the largest oil supply disruption in history.” That’s because about a fifth of the world’s oil passes through the Strait of Hormuz, on Iran’s southern coast—or at least, it used to. Iran warned tankers and other commercial vessels not to transit the strait, and at least nine of them have now come under attack in the Gulf region. Shipping traffic through the strait has virtually stopped.

Trump has offered U.S. Navy escorts (and insurance) to vessels transiting the strait, but as my colleague Ben Parker explained, that’s not a feasible solution. We’re now seeing the fallout: Iraq, for instance, slashed oil production by nearly 1.5 million barrels a day because it’s unable to load tankers and is running out of storage. Refineries in Saudi Arabia, Kuwait, and Bahrain have slowed output or shut down entirely; one in Bahrain was reportedly hit by a drone strike today. Meanwhile, China has begun hoarding fuel.

Gasoline might be the most noticeable price Trump is turbocharging right now, but it’s far from the only one.

Other energy markets are affected, too. Qatar, which supplies about 20 percent of the world’s liquefied natural gas, halted LNG production after a drone attack. Production there will take weeks to restart.

As a result, downstream firms that require LNG to operate are closing shop, too. For example, the Gulf region is responsible for nearly a tenth of the global aluminum supply. Already this week, multiple major aluminum smelters had to initiate shutdowns; one company says it may take up to a year to restart production.

Production of methanol and other chemicals has also been disrupted. Same with fertilizers used to grow the world’s food supply: Roughly 35 percent of global exports of urea (the most common nitrogen fertilizer) and 45 percent of global exports of sulfur (used to produce phosphate fertilizers) traversed the Strait of Hormuz. Fertilizer prices are already spiking, and American farmers are freaking out. Consumers may see “higher prices for bread within six to 10 weeks, eggs within a few months and pork and broiler chicken within six months,” according to an estimate from food-system expert Raj Patel.

And then there are the gazillions of consumer goods that people may not realize use petrochemicals as inputs. Those include clothes, iPhones, candy, dentures, dishwashing liquid, footballs, shampoo, toothpaste, lipstick, plastic toys, trash bags, umbrellas, tires—you name it. These products won’t immediately get more expensive, but we should anticipate that the chemicals that go into these products will start to get costlier if the war continues for a month or two, per Seth Goldstein, a senior equity analyst who covers chemicals for Morningstar.

Higher fuel prices also feed into higher prices for virtually all other goods—and many services, too—because most modes of transportation use fossil fuels.

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I DON’T THINK TRUMP is deliberately trying to raise prices. But if he were, it’s not clear how much he’d be doing differently right now.

This is why it’s so striking that Trump decided to start this war in an election year—and at a time when prices were already arguably the biggest issue dragging down his approval ratings, to boot. (I’ll leave geopolitical, military, and humanitarian considerations of the war to other experts, but my colleagues suggest those aspects don’t reflect particularly well on him, either.) The Biden administration went through a similar cost-of-living crucible in the 2022 midterms, when gasoline prices spiked because of a different war and featured prominently in GOP midterm attacks; and then again in the leadup to the 2024 presidential election.

At the time, naïve economic commentators such as yours truly had to explain that presidents can’t have much effect on prices, despite what voters assume. But between tariffs, mass deportations (and a resulting depletion in the agricultural workforce), politicizing the Federal Reserve, and bombing Iran, Trump seems intent on proving us wrong.

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— Voters may be mad, but there will also be winners from rising oil prices, of course—including producers outside the United States. Vladimir Putin, for instance, can use the windfall to help pay for his war in Ukraine.

— Trump and White House Press Secretary Karoline Leavitt appear to believe that the military conflict will ultimately reduce energy costs in the United States. It’s unclear how that would work. I imagine it involves “taking the oil” (à la Venezuela) and underpants gnomes.

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— The Pentagon estimates that the war costs around $1 billion per day, according to the Atlantic’s Nancy Youssef.

— New possible sign of frailty in the U.S. economy: The number of Americans withdrawing money early from their 401(k)’s just hit a record high.

— Meanwhile, Sens. Ted Cruz (R-Texas) and Tim Scott (R-S.C.) are asking the Treasury Department to approve a $200 billion tax cut without congressional approval. It would be an effective cut to capital gains taxes, which overwhelmingly would benefit the wealthiest Americans. Nice splitscreen there with the prior item.

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THERE’S AN OLD JOKE ABOUT two elderly ladies kvetching about a meal. “Oy, the food at this place is really terrible,” one complains. The other responds, “And such small portions!”

The same could be said of President Trump’s affordability comments at last night’s State of the Union, which were both brief and abysmal.

Affordability is the issue for the 2026 midterms. In virtually every poll, with virtually every demographic, some version of “inflation/prices/cost of living/economic problems” tops the list of the most important challenges facing the country. It also tops the list of reasons Trump’s own voters are ditching him, according to polling from Morris Predictive Insights.

And yet, according to the time-keepers from NBC News, in Trump’s record-long 108-minute SOTU speech, he spoke about affordability for a measly 2.9 minutes.

For context, that’s just a few seconds longer than the time he spent celebrating the country’s Olympic achievements (2.2 minutes), and about half the time he spent talking about Venezuela (4.8 minutes). Even if you add in time he spent on the broader economy and taxes, this total (7.1 minutes) is still less than the amount of time he spent talking about national security (8.5 minutes).1

If Republican lawmakers were hoping Trump would spend his ample time on the things their voters care about, they must have been disappointed.

When he did touch on affordability, Trump questioned the very notion that it was a legitimate issue at all. He claimed that “affordability” problems were either created or imagined by Democrats, and naturally, that they have all been solved since he took office:

Now, the same people in this chamber who voted for those disasters suddenly used the word “affordability.” . . . they just used it because somebody gave it to them, knowing full well that they caused and created the increased prices that all of our citizens had to endure. You caused that problem. You caused that problem.

They knew their statements were a lie. They knew it. They knew their statements were a dirty, rotten lie. Their policies created the high prices. Our policies are rapidly ending them. We are doing really well. Those prices are plummeting downward.

This message does not seem to be resonating with voters, most of whom say Trump is making prices and inflation sound like they’re in better shape than they really are.2 And they’re right: Notwithstanding Trump’s claims, prices are not “plummeting downward.”3 Prices are very much still rising—and rising faster than the Federal Reserve’s target of 2 percent. And there’s evidence that Trump’s tariff policies are contributing to that above-target inflation. For example, prices of appliances, furniture, and new cars, all products targeted by Trump tariffs, grew sharply from December to January.

Not to worry. Trump promised that his tariff revenue would be used to defray other American expenses—specifically, that it would “substantially replace” income taxes. This is a mathematical impossibility.

Tariff revenue certainly grew under Trump, totaling $264 billion in calendar year 2025 (more than triple the amount collected in 2024, by the prior administration). Meanwhile, the personal income tax brought in roughly $2.7 trillion in calendar year 2025. Trump can jack up tariff rates as much as he likes, but at some point he’s going to wind up on the wrong side of the Laffer Curve—that is, we’ll reach a tax rate that makes products so expensive that people stop spending, and tariff revenue declines. Given these limitations, one recent paper estimated that the most revenue that could possibly be wrung out of tariffs was in the ballpark of $400 billion to $500 billion, or less than a fifth of the revenue from income taxes.

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That wasn’t the only time in the speech that Trump characterized the economic pain he inflicted on the country as a victory. He said he “lifted 2.4 million Americans, a record, off of food stamps.” These people weren’t lifted up so much as kicked off: The figure of 2.4 million is the Congressional Budget Office’s estimate for how many people will lose food assistance in the average month because of Trump’s One Big Beautiful Bill.

Other figures appeared completely made up,4 such as his claims about gas prices. Gas prices have indeed fallen, but the president claimed they were “below $2.30 a gallon in most states.” It’s unclear where he got that figure; data from places like AAA and GasBuddy don’t show gasoline prices averaging below that level in any state.

Trump also offered his standard talking point about the booming stock market, but as I’ve noted before, markets have actually grown a lot more in the rest of the world than they have here. Not to mention that paper stock market gains are cold comfort to people struggling to put food on the table.

To the extent he acknowledged there was any further work to be done on affordability, he rehashed the same promises and ideas he’s repeated before—all of which either wouldn’t help Americans afford the things they need to buy, or would make it more difficult.

One example is his promise to block “institutional investors” from buying single-family homes. As I wrote last week, this idea has purchase (so to speak) among some Democrats as well, but it will not reduce housing costs. Institutional investors, usually defined as landlords with at least 1,000 homes in their portfolio, represent less than 1 percent of all single-family housing stock, and have been selling their holdings on net for most of the past two years. Tellingly, construction- and homebuilder-related stocks took a beating the day after the speech, in part because Trump didn’t even pretend to care about building more housing supply.

There was also a shoutout to Trump’s “Great Health Care Plan,” which he said would “stop all payments to big insurance companies and instead give that money directly to the people so they can buy their own health care, which will be better health care at a much lower cost.” As my colleague Jonathon Cohn has explained, that is bunk. Trump likewise claimed that he’s gotten Americans the lowest drug prices anywhere in the world; this, too, is bunk.

Trump also proposed a nonbinding “ratepayer protection pledge,” in which big tech companies agree to foot the bill for powering their own data centers. Seems like a sensible idea, if it ever gets any teeth, but at least as described, it wouldn’t bring prices down, despite Trump’s claims. At best, it would lessen further price increases.

Finally, while previews of the speech had promised “a new form of corporate and personal tax cuts,” the only “new” tax cut proposal was a retirement tax incentive. Specifically, Trump promised to give workers without 401(k) plans “access to the same type of retirement plan offered to every federal worker.” He said the government would “match your contribution with up to $1,000 each year, as we ensure that all Americans can profit from a rising stock market.”

This actually sounds promising! But it already exists.

The program is known as SECURE 2.0, and it was signed into law by then-President Joe Biden in 2022. Trump wants to “tweak” the program in as-yet-unspecified ways, per Bloomberg correspondent Josh Wingrove.

That’s a lot of hokum Trump managed to cram into a small sliver of his speech. But given the fare on offer, maybe Republicans in the audience should be grateful he didn’t provide more material. The portion size in this case was . . . just enough.

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Ramparts

— Also in the speech, Trump said Vice President J.D. Vance would be in charge of a new “war on fraud.” Psst: The call is coming from inside the White House.

— A couple months back I wrote about how the construction industry was curiously silent as Trump’s immigration-enforcement goons rounded up their workers (even those who are U.S. citizens) and busted into construction sites without a warrant. The tide may be turning on that; there have been a few stories of late about homebuilder complaints, although most seem to quote the same handful of voices. One of those voices, the executive director of the South Texas Builders Association, appeared recently on my MS NOW show. I asked him why the only lawsuit over these issues seems to be one filed by a U.S.-citizen construction worker, rather than the builders, particularly when the government argues that only the construction companies have standing to sue. Watch his answer here.

— This horrifying story reminds me of attics in Amsterdam.

— Some good news on energy: U.S. power plant developers and operators plan to add 86 GW of new utility-scale electric generating capacity to the U.S. grid in 2026. This would be a record. Solar power makes up 51 percent of the planned 2026 capacity additions, followed by battery storage at 28 percent and wind at 14 percent.

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FOR MAGA REPUBLICANS, the root cause of every problem is immigrants. Populist Democrats, by contrast, prefer to scapegoat billionaires and Big Business.

But lately, President Donald Trump has started to bogart Democrats’ favorite villains, too, by casting them as the baddies conspiring to increase housing costs. There’s now bipartisan (and yet wrong) agreement that Wall Street’s “institutional investors” are to blame for high home prices, and Congress appears on the verge of making the problem worse.

Here’s the background: Trump has struggled to address Americans’ affordability concerns. Calling the whole thing a “hoax” didn’t work. His administration frequently blames immigrants for high prices, especially when it comes to homes. (“Want affordable housing?” DHS tweeted. “Help report illegal aliens in your area.”) Yet somehow, even as the administration claims to have deported hundreds of thousands of immigrants, prices still aren’t going down. In fact there’s reason to believe that house prices could rise faster than they otherwise would, because Trump is effectively shrinking the homebuilding labor force.1

So the president has pivoted.

Last month, Trump announced that his new solution for the housing affordability crisis would be banning “institutional investors” from owning homes. He is now demanding that Republicans in Congress add an amendment to their housing bill to enforce the ban, reportedly with language that would allow the treasury secretary to define or exempt institutional investors as he sees fit. “Neighborhoods and communities once controlled by middle-class American families are now run by faraway corporate interests,” Trump wrote in his executive order. “People live in homes, not corporations.”

If this sounds like the kind of thing you might hear progressive Democrats say, that’s because it is.

For years, progressives have argued that the real reason that prices are high is that Wall Street firms are gobbling up all the homes. It’s a compelling narrative with terrific optics: Politicians naturally want to be seen as standing up for the little guy against big, bad, greedy corporations.

Unfortunately, the story happens to be wrong.

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First let’s define our terms. “Institutional investors” typically refers to landlords who own at least a thousand housing units. And it is true that in the aftermath of the 2008 housing bust, when foreclosures skyrocketed and there was a surplus of housing, some big Wall Street institutions (such as Blackstone) did swoop in to the market and buy lots of homes on the cheap. This was, and remains, controversial. They didn’t buy these homes to bulldoze them, of course; they bought them to rent them out. Which they did, and some continue to do.

But today, institutional investors hold a teeny share of single-family housing: roughly 3 percent of single-family rentals, and around 0.5 percent of all single-family housing stock (i.e., rentals and owner-occupied housing together). To be clear, there are a lot more homes that are owned by “investors” of some kind—people other than the primary occupant. Most of these investors, though, are mom-and-pop landlords who own fewer than ten properties, not the big “institutional” investors that politicians want to boot from the market.2

Even in markets with a higher concentration of institutional investor–owned homes, the share is still pretty slim. For example, the most concentrated markets are Atlanta and Jacksonville, and in each place big corporate investors hold about 3 percent of single-family housing stock, according to the real estate data platform BatchData.

What’s more, institutional investors have largely been reducing their holdings. For the past seven consecutive quarters, large institutional investors have been net sellers of single-family homes. For example, in the third quarter of 2025, they sold 5,798 homes while purchasing only 4,663.

They’re not getting out of the housing market entirely; rather, they’re shifting their capital to build new housing instead of buying up existing housing stock. “Institutional players continue their strategic pivot, deploying capital into build-to-rent projects, adding inventory rather than competing with traditional homebuyers for existing inventory,” according to BatchData.

The upshot is this: If Congress bans institutional investors from owning homes, at best it will probably have no effect on housing costs for normal people. At worst, it could raise costs, at least in rental markets where these mega-investors might have otherwise added more housing stock.3

Actual fixes to housing affordability are complicated. They involve zoning, construction costs, permitting and regulatory reform, and other eye-glazing issues.4 They also sometimes ruffle the feathers of important political constituencies.

For example, there are the NIMBY homeowners5 whose retirement savings are tied up in their home equity, and who therefore don’t want to see the housing supply grow and housing prices fall. Hence Trump’s recent, puzzling assertion that he’s going to make housing more affordable but also somehow more expensive. (“People that own their homes, we’re going to keep them wealthy. We’re going to keep those prices up. We’re not going to destroy the value of their homes so that somebody that didn’t work very hard can buy a home.”)

Blaming Big Bad Corporate Interests is easier than advocating policies that might alienate NIMBY boomers or trying to streamline permitting bureaucracies. So you get a lot of demagoguing, with little effort to understand, explain, or solve the very real problem of burdensome rents and would-be homebuyers being locked out of the market. Unfortunately, it’s hard to write the right prescription if you get the initial diagnosis wrong.

You know how you can tell these politicians may not have thought this through? They can’t even keep straight the names of the companies they want to ban. Vice President JD Vance gets this wrong all the time, leading an unrelated firm that doesn’t own any single-family homes to release pleading statements each time it gets mistakenly namechecked. Is the big bad villain supposed to be Blackstone? BlackRock? Blackwater? Something black, for sure.

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Ramparts

— Another slopulist housing policy that has gained support in the past year (and that economists almost uniformly hate) is rent control, which has been finding adherents in New York City, Los Angeles, and Boston, among other places. I’ll probably write a future newsletter on this topic.

— Trump is threatening to block the opening of a new bridge between the United States and Canada. This would be very bad for the U.S. auto industry, which sends goods back and forth across the existing, privately owned bridge daily. Note that the guy who owns the existing bridge has also personally been lobbying Trump to prevent competition: He met last week with Commerce Secretary Howard Lutnick the same day Trump started his bridge-posting campaign. Democratic lawmakers seem to have noticed. Watch this space.

— National Economic Council Director Kevin Hassett says that Fed economists should be punished for a paper finding that Americans bear most of the cost of Trump’s tariffs. “The people associated with this paper should presumably be disciplined,” Hassett said, “because what they’ve done is they’ve put out a conclusion which has created a lot of news that’s highly partisan based on analysis that wouldn’t be accepted in a first-semester econ class.” I wonder what he would say about an economist who predicted COVID deaths would fall to zero in May 2020 using an Excel function.

— JPMorgan Chase is reportedly in talks to become the banker for Trump’s “Board of Peace,” the institution meant to rebuild Gaza/rival the United Nations/provide a personal slush fund for the president. Just coincidentally, Trump sued JPMorgan last month for $5 billion for “debanking” him.

— Last year Trump pardoned the founder of Binance, Changpeng Zhao, who had been convicted of money laundering. Now Binance holds 87 percent of Trump’s stablecoin. Another crazy coinkydink.

— This story has everything: Grift. Immigration. Ron DeSantis. Toilets. A corporate phone number that (intentionally) spells out the word “POOP.” “$92 million for porta-potties? Big spending at ‘Alligator Alcatraz’.”

CHECK OUT THE NUMBERS: Hiring has slowed significantly. In fact, we had less job growth all of last year than we had in an average month during the Biden administration. Inflation is still too hot. Health insurance costs have spiked. And it turns out that, despite President Donald Trump’s promises that foreign companies would be paying for his tariffs, in fact it’s U.S. consumers who are paying 95 percent of the domestic cost, according to the Congressional Budget Office.

No surprise, then, that Americans are big mad about the economy. So mad, in fact, that they miss Joe Biden’s economy, which as you may recall they very much despised.

The Trump administration has a two-part strategy for allaying these concerns:

1. Deny there’s a problem

2. Promise stimulus checks that never come

Previous editions of Receipts have covered #1, including Trump’s habit of calling affordability concerns a “hoax.” So let’s home in on #2, particularly since the president reiterated in his NBC News interview last week that he would send out $2,000 checks. “I’m the only one can do it,” he said, “because I’m takin’ in hundreds of billions of dollars of money from tariffs.” But the real record of his promises over the past year suggests otherwise.

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MOVE OVER, Joe Camel. Get lost, Jared Fogle. The newest, grossest, most child-endangering industry mascot is ready for his closeup, courtesy of the Trump administration.

Meet “Coalie.” He’s a cartoon lump of coal with a yellow hard hat and large, anime-like googly eyes, and he’s been enlisted as the “spokesperson” for Donald Trump’s “American Energy Dominance Agenda,” per Interior Secretary Doug Burgum. Coalie is here to make coal look cute and cuddly, so young Americans can learn to love coal and older ones can rekindle the romance.

Make Black Lung Great Again!

Despite Coalie’s sweet kawaiian gaze, coal is obviously not the most wholesome energy source out there. Emissions from coal-fired plants are bad for the climate, bad for the local environment, and terrible for nearly every metric of children’s health. Coal extraction has sickened or killed generations of miners, and the Trump administration’s deregulatory agenda has made it easier to poison today’s workforce too. But even with a mawkish marketing campaign ignoring all these drawbacks, coal is unlikely to enjoy the economic renaissance under Trump.

And that’s part of a larger, underappreciated pattern with this administration. Trump has promised to revive a host of brawny, blue-collar industries that apparently remind him of when America was great. These tend to be predominantly male-dominated sectors that have been in long-term structural decline; their employees, mostly engaged in physical labor, have been displaced partly by trade but mostly by automation. But no matter how much money he throws at the old-timey he-conomy, these sectors continue to fall behind—in part because Trump’s own economic agenda is hampering them.

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As a source of energy in the United States, coal has been in decline for more than a decade.

That’s because coal is just no longer cost-competitive relative to other energy sources, particularly natural gas in the post-fracking era.1 Nonetheless, Trump has tried to prop up coal out through various means, including:

1) spending hundreds of millions of dollars directly subsidizing the coal industry;

2) rolling back mine safety regulations and oversight, ostensibly to encourage more investment;

3) mandating that some coal plants slated for retirement remain open—even if their equipment hasn’t been maintained, is experiencing mechanical failures, or is otherwise in disrepair; and

4) trying to sabotage other energy sources or else make them more expensive. For instance, the administration has tariffed solar parts, repealed renewable energy tax credits, and revoked federal approvals for wind and solar farms.

But even this isn’t enough.

There are now about 40,000 people working in the coal industry. For comparison, that’s less than the undergrad enrollment at Penn State. And employment in the coal industry has, on net, declined slightly in the past 12 months, losing about 1000 jobs.

Like coal, manufacturing was also supposed to enjoy a new golden era under Trump. Instead, it lost 68,000 jobs over the past year. Other metrics show it in contraction for most of Trump’s current term (and prior to his inauguration, to be clear).

This is part of a long-term structural decline. We are a services-based economy, and have been for many decades. Lower-value manufacturing has moved abroad, and higher-value production is increasingly done by a few people and many, many robots.

In addition to these longer-term challenges, manufacturing now also must contend with Trump’s disastrous trade wars. These trade wars have hampered or killed off many of our export markets, and also made it much more expensive for U.S. firms to operate. After all, American factories purchase materials and equipment from abroad. And even when they switch to domestic producers shielded by tariffs, their input costs still rise. That’s sort of the whole point of the tariffs: to help domestic producers capture more of the market and give them more pricing power.

Take the examples of steel and aluminum. Trump has placed draconian global duties on these metals. As a result, steel prices in the United States have skyrocketed relative to prices abroad.

Employment in domestic metal manufacturing firms is now doing okay—it’s up a touch year over year—because Trump pummeled the international competition with tariffs. Meanwhile, American firms that have to buy steel (machinery, furniture, electronics, cars) are screwed and shedding workers.

Then there’s the agricultural sector, which is also struggling.

Key inputs (fertilizer, machinery) have been tariffed to death, raising farmers’ costs. Much of the agriculture workforce is being rounded up, or is preemptively fleeing ICE. And again, export markets have closed off, with soybean sales to China completely suspended for an unprecedented six straight months. Farm bankruptcies in the first nine months of 2025 were 36 percent higher than the total for all of 2024. Trump’s measly $12 billion payoff “bridge payment” to farmers will not heal this damage, particularly if their export markets are lost for good.

Construction employment isn’t down yet, but hiring has significantly slowed. And deportations, tariffed inputs, and high interest rates (driven in part by tariff-related Trumpflation) are all weighing on the sector, too.

It’s proving tough to be a worker in the male-dominated sectors of the Trump economy. Assuming the tariffs aren’t going anywhere, they’re gonna need a lot more cutesy cartoon mascots.

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Looking for a Hero

One running theme of my newsletters is exploring what it will take for the corporate sector to finally stand up to Trump’s threats to democracy—if not out of a sense of duty or patriotic ideals, at least to protect its own self-interest. After all, destruction of the rule of law, corruption, erratic authoritarian decrees, expropriation, weaponization of government powers against perceived enemies, etc. are all terrible for the bottom line and economic growth writ large.

This week got my hopes up—at least a little.

Citadel CEO Ken Griffin, a GOP megadonor, made headlines with some terse comments at a Wall Street Journal event in West Palm Beach. Griffin has been critical of Trump’s policies before, including tariffs and assaults on Fed independence. But somehow this felt different, in part because Griffin criticized not just poorly thought-out policy, but also corruption.

Asked about reports that Trump secretly sold a 49 percent stake in his crypto firm to an Abu Dhabi royal days before his second inauguration, Griffin alluded to possible self-dealing.

“This administration has definitely made missteps in choosing decisions or courses that have been very, very enriching to the families of those in the administration,” Griffin said. “That calls into question, is the public interest being served?”

I don’t want to make too much of this. Griffin also praised Elon Musk for selflessly walking away from the private sector in pursuit of “public service” via DOGE—a laughable assertion considering how little DOGE achieved, and Musk’s overwhelming conflicts of interest in that role.2

Griffin also managed to both-sides his critiques of Trump’s corruption: “Most CEOs just don’t want to find themselves in the business of having to, in some sense, suck up to one administration after another to succeed in running their business.”

Nonetheless, even this gentle criticism is braver than what most titans of industry have been able to muster. So I’ll say: more of this, please.

My real hero for this week, though, is Julie Le, an ICE lawyer who had been working as a detail for the U.S. attorney’s office in Minnesota.

You may have seen her now-viral comments saying “This job sucks,” and suggesting she almost wished a judge would hold her in contempt so she “could get 24 hours of sleep.” But the rest of the transcript of her colloquy with Judge Jerry Blackwell is equally remarkable.

Le said that she had tried to resign, but ended up staying to help wrongfully detained people get out of detention. She also observed that her own family was at risk: “I am not white, as you can see,” she told the judge, “and my family’s at risk as any other people that might get picked up too.”

She was later fired from the U.S. attorney’s office; it’s unclear whether she was fired from her ICE post as well. Read an annotated version of the transcript here, courtesy of Chris Geidner.

“I LOVE THE POORLY EDUCATED,” Donald Trump once declared. That was back in 2016, during his first presidential campaign.

Now, a decade later, he and the rest of the MAGA movement have manifested that love into policy, with a series of changes that have hobbled America’s entire knowledge sector.

It’s been both disruptive and deeply damaging. For over a century, America’s knowledge economy has been our golden goose. Thanks to both private and public R&D, we have developed the strongest military, the most cutting-edge tech companies, and global dominance in the fields of science and medical research. These successes didn’t happen by accident. They were the result of deliberate policy choices going all the way back at least to the Morrill Act of 1862.

That’s the law that created land-grant colleges during the middle of the Civil War, just to give you a sense of how long America has prioritized higher education even in the direst of circumstances.

Over subsequent decades our policymakers made other choices to invest in and harness knowledge creation. They did so through our regulatory regime and federal investment in R&D. Perhaps most importantly, they opened up our immigration system in the mid-twentieth century to attract the best and brightest scientific talent from around the world. By one estimate, foreign STEM workers immigrating to the United States accounted for between 30 to 50 percent of all U.S. productivity growth between 1990 and 2010. These international STEM workers came to the United States to study, research, and collaborate with native-born scientists; they invested their skills in growing the U.S. economy. They also founded blockbuster businesses.1

Today, as other countries invest in developing the technologies of the future, our advantage is being rapidly unwound. This, too, is not something that has just happened on its own. It was not inevitable. It was a choice. It’s the Great American Brain Drain, courtesy of MAGA.

TRUMP SOMETIMES CLAIMS he wants more high-skilled immigration. But his record shows the opposite. In the past year, Trump has made it dramatically harder for high-skilled workers to come to or stay in the United States, where they would otherwise be able to contribute their talents to our economy. Some of these actions have gotten some press coverage, such as the $100,000 fee he’s tacked on to the so-called skilled-worker visa, known as an H-1B.2 This is, needless to say, prohibitively expensive for virtually any employer, who already must certify that the workers they’re sponsoring are being paid the prevailing wage and are not taking the job of an equally qualified U.S. citizen.

But the six-figure visa fee is hardly the only brick in Trump’s wall keeping out high-skilled immigrants. In December, the administration finalized a new rule that will make it harder for recent graduates to get high-skilled worker visas, including those who graduate from U.S. universities. This is not to be confused with yet another rule expected in the next few months that would make it harder for graduates of STEM degree programs at U.S. universities to stay and work after graduation through their student visas.3

These are among a slew of recent under-the-radar regulatory changes that will make it hard or impossible for high-skilled immigrants to come or stay here.

Some changes haven’t even been formally announced: For example, immigration attorneys have reported that U.S. consulates in India abruptly canceled visa interviews at the beginning of this year4—and won’t allow applicants to reschedule their appointments until 2027.

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Red states are getting in on the fun, too. The governors of Florida and Texas both recently announced plans to block public educational institutions from hiring workers on H-1Bs. This will be disastrous for some of these states’ strongest and most prestigious institutions, whose success depends on being able to hire the best researchers and clinicians regardless of nationality.

Take the University of Texas MD Anderson Cancer Center, the largest cancer center in the world.

Government data shows that MD Anderson has hired around 100 new H-1B workers annually in recent years. Based on both how long these visas last and expected turnover, “a conservative estimate would be that MD Anderson has 400 to 500 people working in H-1B status,” according to Stuart Anderson, executive director of National Foundation for American Policy, a pro-immigration think tank. (MD Anderson did not reply to a request for comment.)

Other federal measures target international students specifically. Last fall, matriculation by new international students plummeted 17 percent, in part due to visa issues, and the administration has taken measures to drive numbers even lower. For example, Columbia’s settlement with the Trump administration—supposedly designed to combat antisemitism—included a commitment to decrease international student enrollment.

At a broader level, the administration is also working on a rule to change student visas from lasting for the duration of academic program to a fixed four-year term, and then making them much harder to renew. This would destroy U.S. universities’ ability to attract international students pursuing advanced degrees in STEM fields. After all, the median time to complete a Ph.D. is 5.7 years, according to the National Science Foundation.

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All of this amounts to almost masochistic levels of economic self-sabotage.

Higher education is one of our most successful “exports,” and consistently has a huge trade surplus. Consider that, in dollar terms, the rest of the world paid as much to travel to the United States for education-related purposes as they did to buy our natural gas and our coal in 2024. We’re also depriving our country of access to the next generation of critical thinkers. In the recent past, roughly half of STEM doctorates went to international students each year; those doctoral recipients historically have tended to stay in the United States after graduation, work in labs or private companies, and start their own businesses that employ American workers. At least, that has been the case.

Supporters of the Trump administration’s approach insist it will redound to the benefit of native-born Americans, who will now find a bevy of opportunities that didn’t otherwise exist in STEM programs. But despite what the xenophobes in the administration claim, international students aren’t stealing American students’ slots. To the contrary: their tuition dollars enable more American students to attend college. That’s because international students are more likely to pay full freight, and so they end up cross-subsidizing the tuition charged to U.S.-citizen undergrads.

The administration’s professed concern for reserving educational and employment slots for American scientists rings a little hollow for other reasons, as well. Chief among them: They’ve been snatching funding away from researchers regardless of their country of origin.

Meanwhile, the federal government has engaged in a mass purge from its own ranks. In the past year, the federal workforce lost more than 10,000 STEM Ph.D.s, according to an analysis in Science. Yes, you read that number correctly. The losses were disproportionately large in some agencies; the National Science Foundation lost about 40 percent of its doctorate-holding experts, for instance.

Trump officials seem unperturbed by this historic brain drain. Treasury Secretary Scott Bessent even gushed last year that all those expert civil servants laid off by DOGE would soon be freed up to work in the factories newly created by Trump’s trade wars.

Alas, that plan hasn’t panned out either: The manufacturing industry is hemorrhaging jobs. Turns out the sectors driven by brains and brawn are both struggling in the Trump economy.

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Ramparts

— At long last Trump may be announcing his choice for the next Federal Reserve chair; on Thursday evening he said he’d name his pick “tomorrow.” Stay tuned. The next big question will be whether the outgoing Fed chair, Jerome Powell, intends to stay on the Fed Board, since his term as a board governor is separate from his chairmanship and doesn’t end until 2028. Usually Fed chairs leave the institution entirely when their term as chair ends; only twice in history has the chair opted to stick around, with the last time in 1978 for only a couple of months. But for a host of reasons, including the DOJ’s political investigation of Powell, he may decide to stay.

— One reason why the public may care less about the decimation of our research institutions is that Americans from all political persuasions have increasingly soured on college. Even a slight majority of Democrats now say college is not worth the (substantial) cost, according to recent polling from NBC News. Of course, whether these respondents still send their own kids to college is a different question entirely. At some point I’ll write a newsletter on how college became a political football, and what universities can and should do to recover their image.

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— Maybe Trump’s love of the poorly educated explains why he and his underlings struggle to do basic math.

— Last week, I wrote about Trump’s collection and weaponization of confidential government records. There have since been developments on that front. In one viral video, an ICE agent told a protester she was going in his “nice little database” and would be labeled a “domestic terrorist.” The White House claimed no such database exists. However, CNN reports that ICE agents received a memo instructing them to collect “intel” on protesters:

A DHS official in Minneapolis sent a memo to Immigration and Customs Enforcement Homeland Security Investigations officers assigned to the state on temporary duty asking them to use a form to input information on protesters and agitators.

The form — titled “intel collection non-arrests” — allows agents to fill in personal information of agitators and protesters who they encounter. It’s not clear whether other agencies in Minnesota are also using the form.

Previously, agents had informally shared information about protesters and agitators with each other, the memo said.

Additionally, in a sworn statement, at least one ICE observer said she had her TSA PreCheck revoked after an encounter with immigration officials. And of course, Attorney General Pam Bondi’s demand for voter rolls as ransom for taking ICE out of Minnesota is another troubling example of how the administration seems to be hoovering up and weaponizing data for political purposes. Please drop me a line if you know of other developments I should track.

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— The Congressional Budget Office estimates that federal troop deployments to U.S. cities cost a total of $496 million last year. Continuing current deployments will cost $93 million per month. This is, to be sure, not the most important reason why the military should be ejected from U.S. cities, but it is a useful data point nonetheless.

— The “sell America” trade continues: According to BlackRock, investors can no longer hedge their bets using bonds.

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THE TRUMP ADMINISTRATION has been compiling lists. There are lists of immigrants, lists of people with developmental disabilities, lists of dissidents—and lately, even lists of Jews.

All ostensibly in the name of public safety.

Over the past year, I’ve been tracking the Trump administration’s use and abuse of federal data. For the most part, this has involved deletions of records that the regime finds inconvenient, or other forms of censorship. For example, the administration has stopped publishing certain statistics on climate change, hunger, trade and sexual orientation. It has also deleted photos of nonwhite people serving in the military. When Trump found the official jobs reports insufficiently flattering, he fired the head of the statistical agency that produces those figures, after having already slashed the agency’s staffing by 20 percent.

But now it’s becoming clearer that some of the most disturbing developments don’t involve data the administration is suppressing, but rather data it’s collecting—in some cases illegally—and the ways those data can be weaponized against perceived enemies.

For example, the Trump administration recently sued the University of Pennsylvania to force it to hand over a list of Jewish faculty, staff, and students. The government is demanding the school release these records without first obtaining consent from Jewish community members themselves; authorities say they need the university to produce this Jewish registry to help the government “combat antisemitism” on college campuses.1

The University of Pennsylvania has refused to cooperate, to its credit. But not every school has done the same. Last year, Barnard College complied with a similar demand. Barnard faculty and staff were shocked to receive unsolicited text messages asking them to fill out a questionnaire bearing the logo of the U.S. Equal Employment Opportunity Commission (EEOC), confirming whether they were indeed Jewish.

This should go without saying, but these days it apparently needs to be said: There’s good historical reason to worry that an authoritarian government leader collecting a registry of Jews, under the pretext of protecting Jews, while that leader has referred to Jews as “disloyal,” and that leader’s coalition has many outspoken Jew haters and Holocaust deniers, may not end up so well for Jews.

“Against a backdrop of rising antisemitism, white supremacy, and other forms of hate, the danger that lists of Jews or other groups could fall into the wrong hands looms especially large,” reads a filing this week from five groups affiliated with UPenn.

What might these groups mean by “the wrong hands”?

Well, even if you give the EEOC the benefit of the doubt and assume that it intends to use this information in a purely benevolent way, someone else in government might try to access Jewish data registry for more nefarious purposes. Such as, say, whoever over at the Department of Homeland Security has been using openly white-nationalist slogans and imagery in its recruiting.

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THE POSSIBILITY THAT THESE DATA could be misused is not just a baseless, hypothetical concern: Again and again the Trump administration has been caught sharing data and breaching confidential records for purposes other than the stated reason for why those confidential records were collected in the first place.

For instance, last year a whistleblower alleged that DOGE had unlawfully accessed private Social Security data and copied it into a less-secure cloud environment, where it could be more easily manipulated and exposed. In court filings, the administration insisted that DOGE employees had done only what was necessary to fulfill Trump’s commands to “modernize technology and to ‘maximize efficiency and productivity’” within the Social Security Administration.

But the whistleblower, Charles Borges, was worried about data security all the same, and was troubled that SSA employees were directed not to talk to him when he started asking questions.

“I’m not alleging any particular nefarious intent or that any data was actually compromised,” Borges, who was SSA’s chief data officer, told me in an interview last week. “But the way that the environment was structured, even if data had been compromised, it’s entirely possible we would never know. That’s a huge risk.”

Borges was right to worry.

Shortly after we spoke, the government finally acknowledged that the DOGE workers at SSA had communicated with an unidentified political advocacy group about using Social Security data to help overturn election results in certain states. In fact, “one of the DOGE team members signed a ‘Voter Data Agreement,’ in his capacity as an SSA employee, with the advocacy group,” the government said in a court filing.

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These kinds of abuses of confidential government records are happening across government.

Last year the Internal Revenue Service agreed to share confidential tax records with ICE to assist immigration-enforcement efforts—despite having assured immigrants for decades that their compliance with tax law would never be weaponized against them.2 A judge blocked the IRS-ICE agreement in the fall, but similar (possibly illegal) data-sharing agreements are being allowed elsewhere. Last month a federal judge ruled that ICE can use Medicaid data in immigration enforcement, for example, while a legal challenge works its way through the courts.

“They’ve been sucking up data from all across government for immigration enforcement purposes, like basically anything that might have names, familial relationship, address, any geographic information,” said Bethanne Barnes, who until October had served for six years as the chief data officer for the Administration for Children and Families at Health and Human Services. “Just assume it’s all getting sucked in.”

Barnes quit, she told me last week, in part due to some “funny business” related to the government’s matching up of information on immigrant children with a national database of employment records. She said she worries not only about how data like these are being misused today, but the amount of distrust these revelations are fostering—which might make the public less willing to report information honestly (or pay their taxes, or cooperate with law enforcement) in the future.

“If you start violating all those protections, especially at scale, eventually it harms the quality of the data, right?” she said. In the past, data-sharing among government agencies has often been uncontroversial—beneficial, even. Matching up records can help officials spot patterns, solve problems, identify failed policies, and improve people’s lives. But when you have an administration that doesn’t respect privacy safeguards and that clearly doesn’t care about improving outcomes for people, then sloppy, secretive, and nonconsensual new efforts at data-sharing should be met with healthy skepticism.

Or sometimes, for that matter, fear.

When the National Institutes of Health director announces his agency will create a “disease registry” of people with autism—to be compiled without consent, via confidential private and government health records—some members of the autism community understandably heard it as a threat. After all, the announcement came a mere week after his boss, HHS Secretary Robert F. Kennedy Jr., stated that children with autism will never lead productive lives. And elsewhere, the president and various political appointees have mocked people with disabilities. NIH subsequently walked back the comments after public outcry from the autism community, but the recent “MAHA” report and other government documentation suggested similar efforts may still be in the works.

Meanwhile, Tom Homan, Trump’s border czar, has threatened to create his own “database” of people who protest ICE, which sounds an awful lot like twentieth-century government databases of Commies, wrongthinkers, and other political enemies. Or perhaps worse historical analogues, from Europe, also implemented in the name of keeping the public safe from the enemies within.

So I ask you, my fellow Americans: Do you feel safer yet?

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Ramparts

— On the point about data suppression: The Trump administration is also intimidating anyone in the private sector who might deign to produce credible alternative numbers. That’s what happened this week when an analyst at Deutsche Bank wrote a client note about how many bonds are held by Europeans (who are obviously pretty mad at us right now). Treasury Secretary Scott Bessent said that the bank’s CEO apparently called to apologize and to say the bank did not stand by the note. If you had assumed that the private sector would step in to fill statistical voids left by government deletions, this should give you pause.

— Last week I wrote about how Trump was driving our allies into the arms of China. This week, French President Macron said: “What we need is more Chinese foreign direct investment in Europe in some key sectors to contribute to our growth.”

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— OpenAI board chair Bret Taylor says that AI is “probably” a bubble, and that he expects a correction in the coming years. Points for candor, I guess.

— A senior CDC official says the loss of measles elimination status in the United States would just be a “cost of doing business.” Lord Farquaad would like a word.

— New research concludes the Trump administration’s policies could cut legal immigration in half over the next four years.

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