President Donald Trump on Wednesday lashed out at his predecessor, former President Joe Biden, after a U.S. government report revealed the economy contracted during the first quarter of 2025. In his statement, Trump defended his controversial tariffs and insisted that his vision for an economic "boom" would take time to materialize.
Trump took to Truth Social to express his frustration, saying, "This is [Biden’s] Stock Market, not Trump’s. I didn’t take over until January 20th." He continued, asserting that the economic downturn was a result of the policies Biden left behind. "Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers. Our country will boom, but we have to get rid of the Biden ‘Overhang,’" Trump claimed.
Despite Trump’s statement, data from the U.S. Department of Commerce paints a different picture. According to the latest report, the U.S. economy contracted at an annualized pace of 0.3% in the first three months of the year. This marked the first instance of negative growth since the first quarter of 2022.
The Tariff Impact
Trump argued that the economic slowdown was tied to his promised tariffs, which had yet to take full effect. However, economists contend that the contraction in GDP was due to a surge in imports as companies sought to stockpile goods ahead of anticipated tariffs. Furthermore, government spending, particularly in defense, decreased, contributing to the overall decline in GDP.
While Trump continues to place blame on Biden’s economic policies, experts have refuted his claims. The report from the Commerce Department highlights several factors, including a reduction in government spending and the preemptive increase in imports, which were the primary drivers behind the negative GDP growth.
Disappointing Job Growth
Trump’s remarks came on the heels of a report from ADP showing a disappointing increase in private payrolls. The data revealed that only 62,000 jobs were added in April, significantly below the forecasted 120,000. This marks the smallest job growth since July 2024 and further underscores concerns about the economy’s sluggish performance.
The lackluster jobs report sent shockwaves through the market, which had already been rattled by the GDP data. Markets opened sharply lower, reflecting investor unease about the economic outlook.
A Divisive Economic Debate
Trump's response to the economic reports comes amid his ongoing efforts to bolster his economic credentials. In a speech on Tuesday marking the 100th day of his second term, Trump boasted of reduced prices, claiming that his policies were responsible for a drop in inflation. However, the GDP report indicated a sharp rise in inflation, with the personal consumption expenditures price index increasing by 3.6% in Q1 — up from a 2.4% rise in the previous quarter.
The weakening job numbers and a drop in consumer confidence have been attributed to the uncertainty surrounding Trump’s tariffs, which have created an environment of economic instability.
Blame and Credit
Trump's attempts to shift the blame for the economic downturn resemble his earlier efforts to claim credit for the stock market's rise during the Biden administration. In January 2024, Trump posted on Truth Social, calling it "the Trump Stock Market" due to his strong polling numbers against Biden.
In contrast, Andrew Bates, a former White House spokesperson under Biden, sharply criticized Trump’s latest claims. "When Joe Biden handed Donald Trump the best-performing economy in the world, experts praised the U.S. for leaving every other wealthy nation ‘in the dust,’" Bates said. "Now we’re plummeting toward a Trumpcession," he added, highlighting the irony in Trump’s shifting narrative.
As the economic debate intensifies, the repercussions of the first-quarter GDP contraction and weak job growth are likely to dominate political discourse in the months ahead, particularly as Trump faces growing scrutiny over his economic policies and their impact on the country’s recovery.
