Don't underestimate for a minute the impact of the ICE enforcement on negative economic growth along with higher prices. "Economists" even credible traditional observers are going to have a hard time incorporating the impact into current and future models until we find out the total impact in the coming months. a new destabilizing element in projections
Here is a comment posted by Bulwarker Karla on a recent Triad. I think it explains consumer sentiment these days. I am hoping Karla doesn't mind me re-posting it here.
One thing that I think JVL consistently underestimates when he focuses on the broad economic success of the USA, and that is the extent to which people who used to be able to swim just fine in past generations are now drowning.
This is not limited to rust belt or rural red areas. This is pervasive and it builds a deep resentment in people which can be channeled by bad actors. I'll try to explain why with some data and personal anecdotes.
My dad always had 3 jobs, his full time job as a warehouse forklift operator, his part-time job as a hazmat firefighter at the warehouse, and some other job like lifeguard at the pool on the weekend.
He had no problem working 6 days a week for my entire childhood, and speaking with him now, he felt really good about his life at the time. He worked and he was rewarded for that work. We're going to focus on his full time job to simplify some economic details.
In 1978, average forklift operator jobs at a union place like he worked was $22,880 based on the hourly pay for that year. The 62 year old, 1,500 sq foot house we lived in cost him $39,000 that year (1.7 times his annual salary).
In contrast, the average warehouse forklift operator today will make about $48,000 per year. If salaries kept up with inflation, that salary today would be $113,767, more than twice today's average.
That same house I grew up in is still standing. It is now 109 years old. It is currently worth $447,200 (9.3 times the annual salary of someone working the same job as my dad).
The highest paid warehouse forklift operator job I could find on Indeed near where I grew up was $60,000/yr (7.5 times annual salary for the same home). If the house value had merely matched inflation it would only cost $194,000. So if a young forklift driver wants to buy my dad's house, he will be working many years longer to own a much older home, which might cost even more for needed repairs and updates.
My dad's job was unionized. He had excellent health insurance with close to no co-pay and no deductible for at least the 20 years I was on the insurance. I had leukemia as a child and between the children's hospital grants and their insurance, my parents paid $0 for years of my care and I get to write this post today.
Dad retired with a pension. He got profit sharing as well each year and put the shares into a 401k for additional retirement savings. He was able to retire at 62 when his plant moved across the country. He still worked part time for several more years because he wanted to, not because he had to.
That $60k job on Indeed has benefits and 401k, but pensions are gone and so is profit sharing, and unless the job is for a pharma company, I doubt the health insurance is close to as good as my dad had.
My mom did not have to work when her kids were young. She only went back to work part-time when we hit middle school. For much of my young life dad's income was the only income. We had two cheap cars. I have a fond memory of playing in the dodge omni, which cost 30% of my father's annual salary in 1985.
Name me a new car you can buy in 2025 for $14,400 (30% of $48,000).
We went to a beach bungalow an hour away from home for one week each year. We cooked our own food on vacation. We went to a restaurant maybe once a year for my mom's birthday because she loved shrimp but hated to cook them. The only take-out we did routinely was pizza and Chinese food.
They were able to pay for my college with no loans with the help of my merit scholarships, so I finished with no debt. My first year of state college tuition in 1998 cost $4,168.
Tuition for 2025 at the same school costs $20,398. It would only be $8,284 with inflation.
The numbers I threw out here are just a few obvious ones that people commonly notice and understand, but virtually everything in our economy has gone this way. People's labor is producing more value, but that value is not being passed on to them.
We are at a point where even people who are not experiencing hardship can feel that something is not quite right.
I am not a psychologist, but I have seen enough to know that people harboring frustration or despair tend to seek an outlet for that feeling because they want to feel better, or if they can't achieve that, they may choose to make other people hurt as they do. Many people want to believe that things can get better for them and those in their circle. Some of those people become democratic socialists and some want to expel all the immigrants. How you express that frustration depends on your geographic, racial, cultural background, current environment and information bubble.
This frustration is the piece that people with their own agendas can and have exploited. It also allows all the other suppressed uglies to bubble to the surface - the racism, xenophobia, homophobia, what have you, which exist in many people but mostly lay quiet when people are content with their lives.
I also don't think this frustration is limited to the poor or working class. Thanks to my parents hard work and support, I'm one of those upper class DINKs with money to spare. I can afford luxuries that my parents never could (like a Bulwark subscription).
And yet I feel an unfathomable rage when I buy a new not-so-cheap shirt and it wears out in one washing while the vintage shirt I have that was made in the 60s looks brand new. I don't want to pay multiple times more for a house than it was worth 5 years ago. I really resent having to pay for my checked luggage, and more recently, for my carry on.
I will end by saying that when I first heard the word enshittification, I thought it explained so much. I know it was first coined to describe online social media platforms, but I think it is a fair descriptor of so much of American life.
Again, thank you for your civility and clear delineation as to your position.
So I will try and do the same - to clearly delineate my closing positions as well.
I was born into an old style conservative family, but was taught to always vote for the person's position for the area - be it city, State, or the US; and do the same on the subject matter, i.e., what is best for the city, State, or US.
So, if you check my voting record -- by necessity; it has been solidly Democratic - in every election:
because I have yet to find either a Conservative Republican, or Trump MAGA Nazi, - that:
1.) would be good for the people of the city, State, or the US -- or
2.) have found a subject where the city, State, or the US is put first -- full stop.
Neither the former Republican Party, or the voter morphed Trump Nazi MAGA Party - has ever "run a politician for any office - that is actually oriented toward the future. They always are running backwards -- looking longingly towards the past -- because of one truth - they are always focused on one thing, and one thing only:
--- "...free enterprise with as little restriction as possible...".
This portion of the US population - always works to weaken, not strengthen US Law; because it either limits or inhibits their commercial enterprises and practices - for the protection of the US population, the World population, and the World itself - where applicable.
This - while loudly proclaiming / "squawking" that "...they're working for the American Public...".
Yeah right -- and I've got bridge in Brooklyn to sell -- they are so lame.
Their "stated positions" are a constant negative -- because that is what the Trump voter wants.
"...It either costs too much" - or it's "...I don't want it because 'the other Party across the aisle' wants it...".
There is absolutely nothing "for the common good" of anyone, or anything, either in the US or the World for that matter as plainly exhibited by the present Republican Party controlled "Totalitarianism / Dictatorship / Limiting Personal Freedom / Xenophobia / Nationalism / Sworn Loyalty / Sovereign Economy based Government.
So when confronted with this "granite hard mindset", continuously found from the bottom of the Republican Party to the top -- the honest question has to be asked of the "other US politicians and voters:
--- just "who" is there left to negotiate with - with that very dangerous answer being?
Sadly, and very dangerously -- "only oneself".
While the rest of the US population actively seeks to continue the legacy of the US political system -- ever since "The Tea Party" Republicans forced their ulcerous beliefs into the realm of US Politics - the Republican Party voter has been actively turning him or herself - from the individual Republican voter - into the blind, mindless politically cancerous herd; known as the Trump Nazi Evangelical MAGA Party.
The following is documented US History - with the result being that for decades - working against the well established unspoken truth about US politics:
--- that you "do your politics" by the established rules of almost 250 years of US History, i.e.,:
--- you negotiated with both honor and truth:
the Leadership of the Republican Party has acted overtly, in concert with the Super Conservative Heritage Foundation; to "stack" the US Supreme Court and all others possible - with Conservative Judges - believing that "...they would all 'tow the party line'...".
This was done "slowly in the open" - because the Republican Party had already successfully established "Rules", not actual Laws - but "Rules" - that they've used over time to give Republican US Senator Mitch McConnell:
--- the means to inhibit and thus shepherd to the "Supreme Court 6" - their Heritage Foundation chosen and groomed individuals now in place:
--- as the rest of us believed their lies at their individual confirmation hearings:
--- and "played by the rules".
Mitch McConnell is on record as saying "...he's proud of what he has done...".
We - unfortunately, are experiencing the results of the treason continuously being committed against the US itself and it's population - by the present Government headed by the publicly self-proclaimed Dictator on Day 1 - Donald J. Trump and his acolytes.
This is just not a "discussion for today" - that is then passed off - as all other news is today.
This topic is for the very existence of the US "as it still remains" - while it is literally being torn apart.
And for what -- pure monetary Greed.
This is not about politics - far from it.
This is about "life for all of the 'others" within the borders of the US - as the Trump Nazi Republican has chosen his or hers.
So please don't "ask me to go quietly in the night" in any closing - as I like living as a free man:
--- and having personally witnessed and lived in the aftermath / hell that the Trump Nazi MAGA Party is seeking to put in place here in the US:
--- I'm not going there.
I will continue to speak out - plainly and truthfully at every opportunity:
--- because it just the future of the US and it's peoples, not it's commerce - that's at stake here.
Another item added to the issue of affordability mentioned by Dr. Krugman in his substack was higher borrowing costs. May help to explain DJT's move to allow interest of car payments to be deducted from income. Apropos the latter, I'm old enough to remember when not only interest on car loans but also from credit cards was deductible. Their removal occurred in 1986 when Reagan's tax cut + defense spending blew up the deficit. Looks like this time we'll have tax cuts + increased government spending + added deductions and maybe a plaint fed chair so we can blow up the deficit and cause stagflation. Think of it as the revers Volcker Rule.
According to ICE’s own numbers, deportations remain far below previous administrations. What’s happening now is mass detention, not mass removal. Immigrants are being taken from working and paying taxes to costing us about $150 per person per day.
Affordability, as being part of governments portfolio of things government can control, is a hoax. These are largely market driven phenomena which government cannot control and should not control.
HOWEVER there are a range of bad choices that can make affordability worse and Trump is managing to exploit them all from the draconian immigration policies to his irrational tariff schemes. The further Republicans walk away from freer trade and toward protectionist policies the market is not able to respond to market conditions which promote competition, innovation and consumer choice and ultimately affordability.
The only way to get Trump to stop electrocuting himself is if he stops jamming a fork into the outlet. But it was the Dems who told him not to, so he won't.
1) The high cost of homes is not only from lack of housing but also from way too many homes being bought by private equity companies. They can afford to keep these homes empty unless they get the prices desired and they turn a lot of them into rentals. This takes a lot of homes off the market for first-time home buyers.
2) In the grocery department, not only have prices risen for everything in this category since the pandemic (and companies won't ever lower those prices) but they've also shrunk the sizes of everything they can. Shrinkflation is very much a thing.
Joe Biden made this same mistake in the run up to November, 2024. Dismissing people's pain in the pocketbook, saying "this economy is too incredible, for inflation to be all that bad. Stop whining, and just keep buying."
We saw where that got him. Although in Trump's case, that fate could be a good thing. I am surprised he's being so dense- but maybe not really. He's emotionally tone deaf, mostly ignorant, and will die before admitting he got anything wrong. After all, he has plans to reduce drug costs by more than 100%. Mathematically impossible, unless the drug companies will be paying people to use the drug. I guess he is kind of dense.
Getting caught up on Receipts. Exceptional work, as always. And, Ramparts, of course : )
Don't underestimate for a minute the impact of the ICE enforcement on negative economic growth along with higher prices. "Economists" even credible traditional observers are going to have a hard time incorporating the impact into current and future models until we find out the total impact in the coming months. a new destabilizing element in projections
Here is a comment posted by Bulwarker Karla on a recent Triad. I think it explains consumer sentiment these days. I am hoping Karla doesn't mind me re-posting it here.
One thing that I think JVL consistently underestimates when he focuses on the broad economic success of the USA, and that is the extent to which people who used to be able to swim just fine in past generations are now drowning.
This is not limited to rust belt or rural red areas. This is pervasive and it builds a deep resentment in people which can be channeled by bad actors. I'll try to explain why with some data and personal anecdotes.
My dad always had 3 jobs, his full time job as a warehouse forklift operator, his part-time job as a hazmat firefighter at the warehouse, and some other job like lifeguard at the pool on the weekend.
He had no problem working 6 days a week for my entire childhood, and speaking with him now, he felt really good about his life at the time. He worked and he was rewarded for that work. We're going to focus on his full time job to simplify some economic details.
In 1978, average forklift operator jobs at a union place like he worked was $22,880 based on the hourly pay for that year. The 62 year old, 1,500 sq foot house we lived in cost him $39,000 that year (1.7 times his annual salary).
In contrast, the average warehouse forklift operator today will make about $48,000 per year. If salaries kept up with inflation, that salary today would be $113,767, more than twice today's average.
That same house I grew up in is still standing. It is now 109 years old. It is currently worth $447,200 (9.3 times the annual salary of someone working the same job as my dad).
The highest paid warehouse forklift operator job I could find on Indeed near where I grew up was $60,000/yr (7.5 times annual salary for the same home). If the house value had merely matched inflation it would only cost $194,000. So if a young forklift driver wants to buy my dad's house, he will be working many years longer to own a much older home, which might cost even more for needed repairs and updates.
My dad's job was unionized. He had excellent health insurance with close to no co-pay and no deductible for at least the 20 years I was on the insurance. I had leukemia as a child and between the children's hospital grants and their insurance, my parents paid $0 for years of my care and I get to write this post today.
Dad retired with a pension. He got profit sharing as well each year and put the shares into a 401k for additional retirement savings. He was able to retire at 62 when his plant moved across the country. He still worked part time for several more years because he wanted to, not because he had to.
That $60k job on Indeed has benefits and 401k, but pensions are gone and so is profit sharing, and unless the job is for a pharma company, I doubt the health insurance is close to as good as my dad had.
My mom did not have to work when her kids were young. She only went back to work part-time when we hit middle school. For much of my young life dad's income was the only income. We had two cheap cars. I have a fond memory of playing in the dodge omni, which cost 30% of my father's annual salary in 1985.
Name me a new car you can buy in 2025 for $14,400 (30% of $48,000).
We went to a beach bungalow an hour away from home for one week each year. We cooked our own food on vacation. We went to a restaurant maybe once a year for my mom's birthday because she loved shrimp but hated to cook them. The only take-out we did routinely was pizza and Chinese food.
They were able to pay for my college with no loans with the help of my merit scholarships, so I finished with no debt. My first year of state college tuition in 1998 cost $4,168.
Tuition for 2025 at the same school costs $20,398. It would only be $8,284 with inflation.
The numbers I threw out here are just a few obvious ones that people commonly notice and understand, but virtually everything in our economy has gone this way. People's labor is producing more value, but that value is not being passed on to them.
We are at a point where even people who are not experiencing hardship can feel that something is not quite right.
I am not a psychologist, but I have seen enough to know that people harboring frustration or despair tend to seek an outlet for that feeling because they want to feel better, or if they can't achieve that, they may choose to make other people hurt as they do. Many people want to believe that things can get better for them and those in their circle. Some of those people become democratic socialists and some want to expel all the immigrants. How you express that frustration depends on your geographic, racial, cultural background, current environment and information bubble.
This frustration is the piece that people with their own agendas can and have exploited. It also allows all the other suppressed uglies to bubble to the surface - the racism, xenophobia, homophobia, what have you, which exist in many people but mostly lay quiet when people are content with their lives.
I also don't think this frustration is limited to the poor or working class. Thanks to my parents hard work and support, I'm one of those upper class DINKs with money to spare. I can afford luxuries that my parents never could (like a Bulwark subscription).
And yet I feel an unfathomable rage when I buy a new not-so-cheap shirt and it wears out in one washing while the vintage shirt I have that was made in the 60s looks brand new. I don't want to pay multiple times more for a house than it was worth 5 years ago. I really resent having to pay for my checked luggage, and more recently, for my carry on.
I will end by saying that when I first heard the word enshittification, I thought it explained so much. I know it was first coined to describe online social media platforms, but I think it is a fair descriptor of so much of American life.
To Norman P:
Again, thank you for your civility and clear delineation as to your position.
So I will try and do the same - to clearly delineate my closing positions as well.
I was born into an old style conservative family, but was taught to always vote for the person's position for the area - be it city, State, or the US; and do the same on the subject matter, i.e., what is best for the city, State, or US.
So, if you check my voting record -- by necessity; it has been solidly Democratic - in every election:
because I have yet to find either a Conservative Republican, or Trump MAGA Nazi, - that:
1.) would be good for the people of the city, State, or the US -- or
2.) have found a subject where the city, State, or the US is put first -- full stop.
Neither the former Republican Party, or the voter morphed Trump Nazi MAGA Party - has ever "run a politician for any office - that is actually oriented toward the future. They always are running backwards -- looking longingly towards the past -- because of one truth - they are always focused on one thing, and one thing only:
--- "...free enterprise with as little restriction as possible...".
This portion of the US population - always works to weaken, not strengthen US Law; because it either limits or inhibits their commercial enterprises and practices - for the protection of the US population, the World population, and the World itself - where applicable.
This - while loudly proclaiming / "squawking" that "...they're working for the American Public...".
Yeah right -- and I've got bridge in Brooklyn to sell -- they are so lame.
Their "stated positions" are a constant negative -- because that is what the Trump voter wants.
"...It either costs too much" - or it's "...I don't want it because 'the other Party across the aisle' wants it...".
There is absolutely nothing "for the common good" of anyone, or anything, either in the US or the World for that matter as plainly exhibited by the present Republican Party controlled "Totalitarianism / Dictatorship / Limiting Personal Freedom / Xenophobia / Nationalism / Sworn Loyalty / Sovereign Economy based Government.
So when confronted with this "granite hard mindset", continuously found from the bottom of the Republican Party to the top -- the honest question has to be asked of the "other US politicians and voters:
--- just "who" is there left to negotiate with - with that very dangerous answer being?
Sadly, and very dangerously -- "only oneself".
While the rest of the US population actively seeks to continue the legacy of the US political system -- ever since "The Tea Party" Republicans forced their ulcerous beliefs into the realm of US Politics - the Republican Party voter has been actively turning him or herself - from the individual Republican voter - into the blind, mindless politically cancerous herd; known as the Trump Nazi Evangelical MAGA Party.
The following is documented US History - with the result being that for decades - working against the well established unspoken truth about US politics:
--- that you "do your politics" by the established rules of almost 250 years of US History, i.e.,:
--- you negotiated with both honor and truth:
the Leadership of the Republican Party has acted overtly, in concert with the Super Conservative Heritage Foundation; to "stack" the US Supreme Court and all others possible - with Conservative Judges - believing that "...they would all 'tow the party line'...".
This was done "slowly in the open" - because the Republican Party had already successfully established "Rules", not actual Laws - but "Rules" - that they've used over time to give Republican US Senator Mitch McConnell:
--- the means to inhibit and thus shepherd to the "Supreme Court 6" - their Heritage Foundation chosen and groomed individuals now in place:
--- as the rest of us believed their lies at their individual confirmation hearings:
--- and "played by the rules".
Mitch McConnell is on record as saying "...he's proud of what he has done...".
We - unfortunately, are experiencing the results of the treason continuously being committed against the US itself and it's population - by the present Government headed by the publicly self-proclaimed Dictator on Day 1 - Donald J. Trump and his acolytes.
This is just not a "discussion for today" - that is then passed off - as all other news is today.
This topic is for the very existence of the US "as it still remains" - while it is literally being torn apart.
And for what -- pure monetary Greed.
This is not about politics - far from it.
This is about "life for all of the 'others" within the borders of the US - as the Trump Nazi Republican has chosen his or hers.
So please don't "ask me to go quietly in the night" in any closing - as I like living as a free man:
--- and having personally witnessed and lived in the aftermath / hell that the Trump Nazi MAGA Party is seeking to put in place here in the US:
--- I'm not going there.
I will continue to speak out - plainly and truthfully at every opportunity:
--- because it just the future of the US and it's peoples, not it's commerce - that's at stake here.
Another item added to the issue of affordability mentioned by Dr. Krugman in his substack was higher borrowing costs. May help to explain DJT's move to allow interest of car payments to be deducted from income. Apropos the latter, I'm old enough to remember when not only interest on car loans but also from credit cards was deductible. Their removal occurred in 1986 when Reagan's tax cut + defense spending blew up the deficit. Looks like this time we'll have tax cuts + increased government spending + added deductions and maybe a plaint fed chair so we can blow up the deficit and cause stagflation. Think of it as the revers Volcker Rule.
Funny l, affordability will eat this administration alive.
Affordability is a monster that can't be defined, nor caught.
I frankly don't know how anything can be affordable once it has gone unaffordable.
According to ICE’s own numbers, deportations remain far below previous administrations. What’s happening now is mass detention, not mass removal. Immigrants are being taken from working and paying taxes to costing us about $150 per person per day.
Sources
ICE official statistics
https://www.ice.gov/statistics
TRAC detention population data
https://tracreports.org/immigration/quickfacts/
Migration Policy Institute estimate of ~ $152/day detention cost
https://www.migrationpolicy.org/article/trump-immigrant-detention
GAO report on arrests vs. removals
https://www.gao.gov/products/gao-24-106233
Guardian dataset summary
https://www.theguardian.com/us-news/ng-interactive/2025/aug/29/trump-immigration-ice-cbp-data
Love the new section! Great newsletter
Affordability, as being part of governments portfolio of things government can control, is a hoax. These are largely market driven phenomena which government cannot control and should not control.
HOWEVER there are a range of bad choices that can make affordability worse and Trump is managing to exploit them all from the draconian immigration policies to his irrational tariff schemes. The further Republicans walk away from freer trade and toward protectionist policies the market is not able to respond to market conditions which promote competition, innovation and consumer choice and ultimately affordability.
The only way to get Trump to stop electrocuting himself is if he stops jamming a fork into the outlet. But it was the Dems who told him not to, so he won't.
Yes, I get it! 😄
Thanks for writing about economics in an easy-to-understand AND interesting way. 💵
I love FRED! Thank you for all the charts.
There are 2 items in the economy I see as issues.
1) The high cost of homes is not only from lack of housing but also from way too many homes being bought by private equity companies. They can afford to keep these homes empty unless they get the prices desired and they turn a lot of them into rentals. This takes a lot of homes off the market for first-time home buyers.
2) In the grocery department, not only have prices risen for everything in this category since the pandemic (and companies won't ever lower those prices) but they've also shrunk the sizes of everything they can. Shrinkflation is very much a thing.
Joe Biden made this same mistake in the run up to November, 2024. Dismissing people's pain in the pocketbook, saying "this economy is too incredible, for inflation to be all that bad. Stop whining, and just keep buying."
We saw where that got him. Although in Trump's case, that fate could be a good thing. I am surprised he's being so dense- but maybe not really. He's emotionally tone deaf, mostly ignorant, and will die before admitting he got anything wrong. After all, he has plans to reduce drug costs by more than 100%. Mathematically impossible, unless the drug companies will be paying people to use the drug. I guess he is kind of dense.
Very glad to have Catherine added to the community. Ramparts will further strengthen The Bulwark!
Excellent work Catherine, and thanks for the Lemon reference. Gold.