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Yahoo
25-05-2025
- Business
- Yahoo
The Era of Thrash
'It almost feels like we're trying to rebuild everything from scratch,' Michael Wieder told me. The company he co-founded, Lalo, sells sleekly designed baby gear, much of it made in China. In his first weeks in office, Donald Trump increased the tariff rate on most of the company's imported goods by 20 percentage points. In April, he jacked the rate up to 145 percent. Lalo had to stop bringing in products from overseas: Paying the tariff could have bankrupted the company. Trump dropped the rate down to 30 percent this month, but Wieder anticipates falling sales and a year of disruption. Ask any corporate executive or entrepreneur about the past five months, and they will tell you a story like Wieder's. Companies are struggling with unstable tariff rates, bond-market swings, canceled federal contracts, rising import costs, and visa challenges. They're unsure about the economic outlook. They're unsure about tax rates. They're unsure about borrowing costs. Last week, Moody's downgraded American debt, meaning it has less confidence in the country's growth and capacity to manage its deficits. This is a year of chaos, so dramatic in its upheaval that it sometimes obscures how weird things have been, and for how long. Over the past half decade, businesses have contended with a pandemic, a recession, an inflationary spiral, and a trade war. They have negotiated swift changes in consumer behavior and input prices and interest rates, as well as significant shifts in policy more broadly, from Joe Biden's New Deal Lite to Donald Trump's autarkic austerity. John Lettieri, the president of the Economic Innovation Group, a Washington-based think tank, calls it 'the era of thrash.' The American economy has weathered that chaos. Despite reams of studies indicating that uncertainty dampens investment and slows growth, today corporate profits are high, the jobless rate is low, productivity has climbed, and new businesses are blossoming. But that resilience may be wearing off, and we may have reached the end of our ability to withstand the disruptions. Is this spell of uncertainty so unusual? Even after talking with a dozen business owners and experts in recent weeks, I came away unsure. A lot seemed to have happened since COVID. Then again, reciting five years of major events might feel like singing the lyrics to 'We Didn't Start the Fire' regardless of which five years you picked. As it turns out, economists have ways of measuring uncertainty, by looking at newspaper coverage, stock-market gyrations, and corporate communications. Those measures show that, sure enough, the first half of the 2020s has proved remarkably unstable and destabilizing. 'We've been through a period of elevated uncertainty,' Steven Davis, of the Stanford Institute for Economic Policy Research, told me. Right now, we are in 'a big surge, relative to what was already a higher-than-average base.' Economists also have ways of measuring the impact of such periods on businesses and the economy writ large. Uncertainty about a country's growth path reduces consumption and investment, depressing industrial production. Uncertainty about inflation reduces bank lending, cutting down on business expansion and formation. Uncertainty about tariffs weakens supply chains and limits the number of businesses joining a market. The economies of countries with stable policy environments tend to grow faster than those of unstable countries. Given that research, you'd think that the past five years would have been dull ones for entrepreneurship and growth. The opposite is true. Americans are forming roughly a million more businesses a year now than they were before the pandemic, despite higher borrowing costs. Corporate profits are fatter than they were before the pandemic. Stock prices—a measure of investor optimism about future earnings—have been volatile, but are up 96 percent over the past five years. 'My biggest takeaway from the last five years of a one-after-another series of different kinds of shocks and uncertainties is an appreciation for the astonishing resilience of the U.S. economy,' Lettieri told me, a note of awe in his voice. Business experts pointed to a few reasons that the chaos leading up to 2025 did not strangle investment or damage growth. For some firms, the coronavirus crisis provided an opportunity by disrupting stodgy markets and upending consumer behavior. Lalo, for instance, benefited from the surge in interest in ordering online, which let it compete with big-box stores that otherwise might have boxed it out. (Now chains such as Target carry the brand.) The pandemic 'played to our benefit,' Wieder told me, and the company managed to navigate the surge in inflation and borrowing costs that followed it. That was, in large part, because the broader governmental response to the pandemic proved to be such a boon for firms and individuals. The Federal Reserve pushed borrowing costs to close to zero. The Trump and Biden administrations spent roughly $4 trillion on support to families and companies, canceling student loans, sending out checks, covering payroll, supporting the parents of young children, and shoring up the coffers of state and local governments. Even as interest rates rose, the private-credit markets remained robust. 'It's easier to absorb an uncertainty shock when underlying economic conditions are strong than when they're weak,' Davis said. From 2020 to 2024, the underlying economy proved notably strong. Today's uncertainty is far more intense and widespread than many businesses anticipated. Wieder and his co-founder had braced for some turbulence when Trump reclaimed the White House. They assumed tariffs on Chinese imports would rise, increasing costs on young families—even if goods like strollers and car seats were excluded from tariffs, as they were during Trump's first term. They hoped to preempt consumer sticker shock by lowering prices in advance. 'It was a really big bet for us,' Wieder said. 'We were protecting our consumer and trying to get ahead of it.' But there was no getting ahead of what followed. The economy is more vulnerable and less resilient than it was a couple of years ago. Interest rates are higher, personal-debt levels have climbed, job growth is slowing, and inflation remains an issue. 'A lot of lending was made during a time of very easy credit,' Diane Swonk, the chief economist at the accounting firm KPMG, told me. 'Now many of those businesses and consumers are being squeezed. Loans that were once renewed easily are now being denied or subjected to far stricter standards.' The political instability of the country, whipsawing between two polarized parties, has also left businesses shaky. And now the White House is proactively destabilizing the policy environment, ignoring court orders and usurping Congress's authority over spending. When it comes to tariffs, the Trump administration is making 'arbitrary executive decisions that are in some cases probably unlawful, and perhaps even unconstitutional,' Davis noted. During the pandemic, the country had a democratic government that made reasonable choices in response to a horrific tragedy. Now it has a more and more despotic government making bad choices for no reason. The past five years didn't prepare us for this. Article originally published at The Atlantic
Politico
25-05-2025
- Business
- Politico
Playbook: The new normal
Presented by With help from Eli Okun and Bethany Irvine Good morning. This is Zack Stanton in the driver's seat this Sunday. Get in touch. Speaking of the driver's seat … our Adam Wren writes in with a SPOTTED from the Indianapolis 500: Sens. Todd Young (R-Ind.) and Jim Banks (R-Ind.); Indiana Gov. Mike Braun; Senate Majority Whip John Barrasso doing a fundraiser with Roger Penske and Sen. Bernie Moreno (R-Ohio); Lachlan Murdoch. DRIVING THE DAY President Donald Trump has a quiet day ahead (famous last words, I know). He'll be at the Trump National Golf Club in Bedminster, New Jersey, until 5 p.m., when he departs en route to the White House, where he's due to arrive at 6:30. But even while the relative calm of a three-day weekend may afford a moment's pause, his political project steamrolls ahead, remaking government in his MAGA movement's image and — key to that goal — doing so while attempting to reset everyone's expectations. The new normal in personal enrichment: NYT's Peter Baker has a smart read this morning on the extent that the Trump family has financially profited from the presidency. They are, he noted, 'hardly the first presidential family to profit from their time in power, but they have done more to monetize the presidency than anyone who has ever occupied the White House. The scale and the scope of the presidential mercantilism has been breathtaking,' including at least $320 million in crypto fees, billions in foreign real estate deals (read also: NYT's Damien Cave on one such project in Vietnam), and even an exclusive new club in D.C. that charges $500,000 a head to join. And yet … 'a mark of how much Mr. Trump has transformed Washington since his return to power is the normalization of moneymaking schemes that once would have generated endless political blowback, televised hearings, official investigations and damage control,' Baker writes. 'The death of outrage in the Trump era, or at least the dearth of outrage, exemplifies how far the president has moved the lines of accepted behavior in Washington.' The new normal in the economy: 'Companies are struggling with unstable tariff rates, bond-market swings, canceled federal contracts, rising import costs, and visa challenges,' The Atlantic's Annie Lowrey writes this morning. 'They're unsure about the economic outlook. They're unsure about tax rates. They're unsure about borrowing costs. Last week, Moody's downgraded American debt, meaning it has less confidence in the country's growth and capacity to manage its deficits.' And yet … 'This is a year of chaos, so dramatic in its upheaval that it sometimes obscures how weird things have been, and for how long. Over the past half decade, businesses have contended with a pandemic, a recession, an inflationary spiral, and a trade war. They have negotiated swift changes in consumer behavior and input prices and interest rates, as well as significant shifts in policy more broadly, from Joe Biden's New Deal Lite to Donald Trump's autarkic austerity. John Lettieri, the president of the Economic Innovation Group, a Washington-based think tank, calls it 'the era of thrash.'' The new normal in the judiciary: 'Amid rising tensions between the Trump administration and the judiciary, some federal judges are beginning to discuss the idea of managing their own armed security force,' WSJ's Katherine Long, James Fanelli and C. Ryan Barber scooped. While Supreme Court justices are protected by their own dedicated police force, 'other federal judges are protected by the U.S. Marshals Service, which reports to Attorney General Pam Bondi,' and some judges are 'worried that Trump could order the marshals to stand down in retaliation for a decision that didn't go his way.' For its part, the White House has condemned attacks against the judiciary. 'Attacks against public officials, including judges, have no place in our society,' White House spox Harrison Fields told the Journal in a statement. 'President Trump knows all too well the impact of callous attacks, having faced two assassination attempts.' And yet … After Trump's public tone toward judges changed in mid-March — when he said U.S. District Judge James Boasberg 'should be IMPEACHED' for ruling that the administration couldn't summarily deport Venezuelan migrants — it precipitated a wave of threats to judges nationwide. 'Starting in April, some judges and their relatives received unsolicited pizza deliveries in the name of Daniel Anderl, the deceased son of U.S. District Judge Esther Salas. Anderl was shot dead in 2020 at his parents' home by a disgruntled litigant.' Companion reading: 'How Trump's clash with the courts is brewing into an 'all-out war,'' by USA Today's Zac Anderson The new normal in speaking to servicemembers: Yesterday, in his commencement speech at West Point, the president wore his signature red MAGA campaign hat to address the Army cadets in an unusual speech for the setting. He boasted of 'liberat[ing] our troops from divisive and demeaning political trainings,' a nod to his war on policies that promote diversity and inclusion. He repeated his frequent campaign rally chestnut that he was investigated more than mobster Al Capone. He spoke of 'trophy wives.' (Douglas MacArthur's May 1962 'Duty, Honor, Country' address this was not.) The new normal at the State Department: POLITICO's Nahal Toosi has a new column that's a must-read for folks in Foggy Bottom, looking at the Ben Franklin Fellowship, a 'not-so-secret society whose members run State.' Its ranks include 'Deputy Secretary of State Chris Landau, top officials in bureaus such as consular affairs, and even an acting undersecretary or two.' The group 'emphasizes goals such as border security; opposes typical diversity, equity and inclusion practices; and advocates for the careful use of U.S. resources abroad,' she writes — which is not altogether surprising or unusual. But what is distinct is 'its heavy focus on reforming the State Department itself,' and the way that it's doing that 'could affect U.S. foreign policy decades into the future.' Companion reading: 'The fellowship: how Trump loyalists are taking over the US state department,' by FT's Guy Chazan SUNDAY BEST … — Sen. Rand Paul (R-Ky.) on the spending cuts in the reconciliation bill, on 'Fox News Sunday': 'I support spending cuts. I think the cuts currently in the bill are wimpy and anemic, but I still would support the bill, even with wimpy and anemic cuts, if they weren't going to explode the debt. The problem is the math doesn't add up. They're going to explore the debt.' He continued: 'Somebody has to stand up and yell, 'the emperor has no clothes.' Everybody is falling in lockstep on this, 'Pass the big, beautiful bill. Don't question anything.' Well, conservatives do need to stand up and have their voices heard.' — Sen. Ron Johnson (R-Wis.) on how many senators agree with his critiques of House Republicans 'big, beautiful bill,' on CNN's 'State of the Union': 'I think we have enough to stop the process until the president gets serious about spending reduction and reducing the deficit.' — Speaker Mike Johnson on his advice to Ron Johnson and other GOP senators who take issue with his chamber's bill, on 'State of the Union': 'I have a very delicate balance here, a very delicate equilibrium that we have reached over a long period of time, and it's best not to meddle with it too much. … We've got to deal within the realm of what's possible.' More from POLITICO's Gregory Svirnovskiy TOP-EDS: A roundup of the week's must-read opinion pieces. 9 THINGS FOR YOUR RADAR 1. FIRST IN PLAYBOOK: POLITICO's Danny Nguyen and Jessie Blaeser dig into a Trump administration project intended to revisit thousands of federal agreements that is 'starting to sink a vast ecosystem of contractors that deploy jobs across the Washington economy.' The 'chainsaw-wielding approach' has produced claims of big savings, including several multimillion-dollar contracts. 'At least 2,775 out of more than 20,000 contracts for consulting and investment advice under review have been cut as of May 11, worth $3.1 billion in claimed savings, according to an analysis of DOGE's list of terminations and government data obtained by POLITICO.' The knock-on effect: 'But the reach of the review — looking back at contracts that have already gone through a competitive bidding process overseen by career civil servants — is nonetheless unprecedented. It has frozen hiring, triggered layoffs and sparked chaos across the consulting industry, a vast shadow workforce across Virginia, Washington and Maryland that often weathers broader economic slumps.' 2. RUSSIA-UKRAINE LATEST: Russia and Ukraine 'swapped hundreds more prisoners on Sunday, the third and last part of a major exchange that reflected a rare moment of cooperation in otherwise failed efforts to reach a ceasefire in the more than three years of war,' AP's Samya Kullab and Oleksii Yeroshenko report from Kyiv. 'Hours earlier, the Ukrainian capital, Kyiv, and other regions came under a massive Russian drone-and-missile attack that killed at least 12 people and injured dozens. Ukrainian officials described it as the largest aerial assault since Russia's full-scale invasion of Ukraine in February 2022.' Ukrainian President Volodymyr Zelenskyy said the silence of America and other world leaders 'only encourages' Russian President Vladimir Putin. 3. DISPATCH FROM THE WILDERNESS: The NYT is launching an 'occasional' series to drill down on the Democratic Party and the key questions it faces: 'how it got so dire, what comes next and who could lead the way,' NYT's Shane Goldmacher writes in the first installment. 'The first challenge is that it is not just Republicans and independents who have soured on the Democratic Party. It is also Democrats themselves. The Democratic base is aghast at the speed with which Mr. Trump is undermining institutions and reversing progressive accomplishments — and at the lack of resistance from congressional leaders.' Painting quite the picture: Longtime Dem researcher Anat Shenker-Osorio has conducted about 250 focus groups with swing voters asking them to compare the two parties to animals. This is the pattern: 'Republicans are seen as 'apex predators,' like lions, tigers and sharks — beasts that take what they want when they want it. Democrats are typically tagged as tortoises, slugs or sloths: slow, plodding, passive.' 4. THE LOAN LURCH: 'Millions of Americans hit with bad credit after missed student loan payments,' by WaPo's Abha Bhattarai: 'Credit scores dipped by more than 100 points for 2.2 million delinquent student loan borrowers, and 150 points or more for more than 1 million in the first three months of 2025, according to an analysis by the Federal Reserve Bank of New York. It's the kind of credit score drop that follows a personal bankruptcy filing. Roughly 2.4 million of those Americans previously had favorable credit scores and would have qualified for cars loans, mortgages or credit cards before these delinquencies were reported, researchers said.' 5. MUDDY IN THE MIDDLE EAST: 'Trump's Warming Toward Syria Complicates Israel's Military Strategy,' by NYT's Michael Shear: 'Trump's surprise embrace of [Ahmed] al-Shara not only offered the new Syrian leader an unexpected lifeline, it also appears to have undercut efforts by the hard-line Israeli government to seize on the instability in Syria and the weakness of the new government to prevent the rise of another anti-Israel neighbor. … Before Mr. Trump's declaration of confidence in the new Syrian leader, [Israeli PM Benjamin] Netanyahu and his top aides in Israel had been determined to deny Mr. al-Shara and his nascent government access to the vast array of heavy weaponry amassed by the Assad regime over its decades in power.' 6. GOING TO CALIFORNIA: Trump's immigration agenda will have a particularly acute impact on California, which counts on immigrants to boost the economy, WSJ's Jim Carlton and Paul Overberg write. 'The state's population rose 0.6% in 2024, reaching 39.43 million by adding almost a quarter-million people, according to Census Bureau estimates. … Democratic Gov. Gavin Newsom, often seen as a potential presidential contender, is publicly touting the population bump. … Yet California's growth is tenuous. Without immigration, it would have shrunk significantly in the past year. Net immigration rebounded to more than 300,000 people in 2024, after plunging to as few as 44,000 in the worst year of the pandemic.' 7. RECRUITMENT REPORT CARD: 'US military spent $6 billion in the past 3 years to recruit and retain troops,' by AP's Lolita Baldor: 'Coupled with an array of new programs, an increased number of recruiters and adjustments to enlistment requirements, the additional incentives have helped the services bounce back from the shortfalls. All but the Navy met their recruiting targets last year and all are expected to do so this year. … Trump and Defense Secretary Pete Hegseth repeatedly point to Trump's election as a reason for the recruiting rebound. But the enlistment increases began long before last November, and officials have tied them more directly to the widespread overhauls that the services have done.' 8. ON THE SCENE: 'They gathered to turn 'pain into purpose.' Then gunfire shattered their peace,' by WaPo's Michael Laris and Karina Elwood: 'This account of Wednesday's tragedy — how an evening suffused with aspirations for peace suddenly dissolved, in the span of a muzzle flash, into unspeakable violence that echoed around the globe — is based on numerous interviews, statements by police and government officials, and publicly available court records.' 9. AMERICAN EXPORT: 'Scientists have lost their jobs or grants in US cuts. Foreign universities want to hire them,' by AP's Christina Larson and colleagues: 'The 'Canada Leads' program, launched in April, hopes to foster the next generation of innovators by bringing early-career biomedical researchers north of the border. Aix-Marseille University in France started the 'Safe Place for Science' program in March — pledging to 'welcome' U.S.-based scientists who 'may feel threatened or hindered in their research.' Australia's 'Global Talent Attraction Program,' announced in April, promises competitive salaries and relocation packages.' TALK OF THE TOWN Kamala Harris spoke at a real estate conference in Australia and urged listeners to 'remember the 1930s.' Jack Schlossberg has completed his journey from Camelot to Cameo: the Kennedy scion is shilling videos for rates starting at $75. THE SHOW MUST GO ON — 'Broadway shows keep the Kennedy Center going. But will they stay away?' by WaPo's Naveen Kumar: 'The gamble is that nonunion tours could net the center more money. Deals between producers and presenting houses vary, but lower production costs mean higher potential profit margins from box office sales split between the parties. But that very likely won't be enough to make up for the center's significant reduction in theater programming.' TRANSITION — Steve Herman is joining Ole Miss as executive director of the Jordan Center for Journalism Advocacy and Innovation. He is retiring from Voice of America, where he most recently was chief national correspondent. The announcement WELCOME TO THE WORLD — Kelly Cohen, Arlington Public Schools occupational therapist, and Josh Cohen, director of comms at the U.S. Global Leadership Coalition and a State Department, Pentagon and Hill alum, welcomed Abby on Thursday. Pic HAPPY BIRTHDAY: Sen. Amy Klobuchar (D-Minn.) … David Sacks … former Maryland Gov. Larry Hogan … Greg Bluestein of The Atlanta Journal-Constitution … Laurie Rubiner … Megan Van Etten of PhRMA … Peyton Vogel … Savannah Haeger of FedEx … Kate Ackley Zeller of Bloomberg Government … CBS' Stefan Becket … Anna Palmer … POLITICO's Catherine Kim and Diana Hernandez … Annie Clark of Rokk Solutions … Alliance for Justice's Carolyn Bobb … former Sen. Gordon Smith (R-Ore.) … former Reps. Steve Russell (R-Okla.) and Ed Whitfield (R-Ky.) … Matt Lakin … Natalie Ihrman of USDA … ABC's Jay O'Brien … Haleah Lewis of the Washington Speakers Bureau … Alexandra Sanchez Send Playbookers tips to playbook@ or text us on Signal here. Playbook couldn't happen without our editor Zack Stanton, deputy editor Garrett Ross and Playbook Podcast producer Callan Tansill-Suddath.
Atlantic
25-05-2025
- Business
- Atlantic
The Era of Thrash
'It almost feels like we're trying to rebuild everything from scratch,' Michael Wieder told me. The company he co-founded, Lalo, sells sleekly designed baby gear, much of it made in China. In his first weeks in office, Donald Trump increased the tariff rate on most of the company's imported goods by 20 percentage points. In April, he jacked the rate up to 145 percent. Lalo had to stop bringing in products from overseas: Paying the tariff could have bankrupted the company. Trump dropped the rate down to 30 percent this month, but Wieder anticipates falling sales and a year of disruption. Ask any corporate executive or entrepreneur about the past five months, and they will tell you a story like Wieder's. Companies are struggling with unstable tariff rates, bond-market swings, canceled federal contracts, rising import costs, and visa challenges. They're unsure about the economic outlook. They're unsure about tax rates. They're unsure about borrowing costs. Last week, Moody's downgraded American debt, meaning it has less confidence in the country's growth and capacity to manage its deficits. This is a year of chaos, so dramatic in its upheaval that it sometimes obscures how weird things have been, and for how long. Over the past half decade, businesses have contended with a pandemic, a recession, an inflationary spiral, and a trade war. They have negotiated swift changes in consumer behavior and input prices and interest rates, as well as significant shifts in policy more broadly, from Joe Biden's New Deal Lite to Donald Trump's autarkic austerity. John Lettieri, the president of the Economic Innovation Group, a Washington-based think tank, calls it 'the era of thrash.' The American economy has weathered that chaos. Despite reams of studies indicating that uncertainty dampens investment and slows growth, today corporate profits are high, the jobless rate is low, productivity has climbed, and new businesses are blossoming. But that resilience may be wearing off, and we may have reached the end of our ability to withstand the disruptions. Is this spell of uncertainty so unusual? Even after talking with a dozen business owners and experts in recent weeks, I came away unsure. A lot seemed to have happened since COVID. Then again, reciting five years of major events might feel like singing the lyrics to 'We Didn't Start the Fire' regardless of which five years you picked. As it turns out, economists have ways of measuring uncertainty, by looking at newspaper coverage, stock-market gyrations, and corporate communications. Those measures show that, sure enough, the first half of the 2020s has proved remarkably unstable and destabilizing. 'We've been through a period of elevated uncertainty,' Steven Davis, of the Stanford Institute for Economic Policy Research, told me. Right now, we are in 'a big surge, relative to what was already a higher-than-average base.' Economists also have ways of measuring the impact of such periods on businesses and the economy writ large. Uncertainty about a country's growth path reduces consumption and investment, depressing industrial production. Uncertainty about inflation reduces bank lending, cutting down on business expansion and formation. Uncertainty about tariffs weakens supply chains and limits the number of businesses joining a market. The economies of countries with stable policy environments tend to grow faster than those of unstable countries. Given that research, you'd think that the past five years would have been dull ones for entrepreneurship and growth. The opposite is true. Americans are forming roughly a million more businesses a year now than they were before the pandemic, despite higher borrowing costs. Corporate profits are fatter than they were before the pandemic. Stock prices—a measure of investor optimism about future earnings—have been volatile, but are up 96 percent over the past five years. 'My biggest takeaway from the last five years of a one-after-another series of different kinds of shocks and uncertainties is an appreciation for the astonishing resilience of the U.S. economy,' Lettieri told me, a note of awe in his voice. Business experts pointed to a few reasons that the chaos leading up to 2025 did not strangle investment or damage growth. For some firms, the coronavirus crisis provided an opportunity by disrupting stodgy markets and upending consumer behavior. Lalo, for instance, benefited from the surge in interest in ordering online, which let it compete with big-box stores that otherwise might have boxed it out. (Now chains such as Target carry the brand.) The pandemic 'played to our benefit,' Wieder told me, and the company managed to navigate the surge in inflation and borrowing costs that followed it. That was, in large part, because the broader governmental response to the pandemic proved to be such a boon for firms and individuals. The Federal Reserve pushed borrowing costs to close to zero. The Trump and Biden administrations spent roughly $4 trillion on support to families and companies, canceling student loans, sending out checks, covering payroll, supporting the parents of young children, and shoring up the coffers of state and local governments. Even as interest rates rose, the private-credit markets remained robust. 'It's easier to absorb an uncertainty shock when underlying economic conditions are strong than when they're weak,' Davis said. From 2020 to 2024, the underlying economy proved notably strong. Today's uncertainty is far more intense and widespread than many businesses anticipated. Wieder and his co-founder had braced for some turbulence when Trump reclaimed the White House. They assumed tariffs on Chinese imports would rise, increasing costs on young families—even if goods like strollers and car seats were excluded from tariffs, as they were during Trump's first term. They hoped to preempt consumer sticker shock by lowering prices in advance. 'It was a really big bet for us,' Wieder said. 'We were protecting our consumer and trying to get ahead of it.' But there was no getting ahead of what followed. The economy is more vulnerable and less resilient than it was a couple of years ago. Interest rates are higher, personal-debt levels have climbed, job growth is slowing, and inflation remains an issue. 'A lot of lending was made during a time of very easy credit,' Diane Swonk, the chief economist at the accounting firm KPMG, told me. 'Now many of those businesses and consumers are being squeezed. Loans that were once renewed easily are now being denied or subjected to far stricter standards.' The political instability of the country, whipsawing between two polarized parties, has also left businesses shaky. And now the White House is proactively destabilizing the policy environment, ignoring court orders and usurping Congress's authority over spending. When it comes to tariffs, the Trump administration is making 'arbitrary executive decisions that are in some cases probably unlawful, and perhaps even unconstitutional,' Davis noted. During the pandemic, the country had a democratic government that made reasonable choices in response to a horrific tragedy. Now it has a more and more despotic government making bad choices for no reason. The past five years didn't prepare us for this.
