Voters sent President Donald Trump back to the Oval Office on his pledge to lower costs on Day One and usher in a new “golden age” of American prosperity.

But the dizzying pace of his executive actions has unnerved some economists who are projecting a downturn or even a recession. During his joint address to Congress, even the normally bullish Trump admitted a “little disturbance” could be on the horizon.

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Fueling the economic concerns are Trump’s rapid-fire tariffs on China, Canada, and Mexico, with additional reciprocal tariffs on all imports set to take hold next month. Coupled with the freezes on government spending and thousands of federal layoffs through Elon Musk’s Department of Government Efficiency, some economists are sending word to Washington that the streak of 11 straight quarters of GDP growth in the United States could be ending.

“There’s no question that recession risks have risen and are rising,” Mark Hamrick, senior economic analyst at Bankrate, told the Washington Examiner on Wednesday.

Bankrate’s survey of economists last year pegged 2025 recession odds at about 1-in-4 — an all-time low in polling for the group. However, since then, the odds have risen to 1-in-3 under Hamrick’s personal projection.

Brian Wesbury, chief economist at First Trust, pointed to “troubling signs” with a drop in retail sales, housing starts, and manufacturing production. DOGE-related cuts and layoffs ticked up unemployment claims, and Trump’s tariffs threats hurt gross domestic product.

“I still expect a recession,” Wesbury told Fox Business. “This is not the Great Depression. We’re not in 2000. We’re not in 2009. We’ll have some pain, but we have to before we get to the gain.”

Publicly, the Trump administration has downplayed concerns surrounding negative economic forecasting. White House press secretary Karoline Leavitt said Wednesday that even though Trump did acknowledge rising prices and stock markets tumbling during his presidential address to Congress on Tuesday, the blame for that pain lies with President Joe Biden.

“President Trump level set with the American people on the economy and exposed how badly Joe Biden screwed it up by causing the worst inflation crisis in four decades,” she said. “President Trump was honest about where we are while making clear that help is on the way. As the president declared last night, he will make America affordable again.”

But there are signs of worry.

Commerce Secretary Howard Lutnick suggested that he could change the way the government measured GDP to remove the impact of DOGE government spending cuts. Musk, Trump’s chief cost cutter, backed Lutnick’s novel approach in a post on X, the social media platform he owns.

“A more accurate measure of GDP would exclude government spending,” Musk wrote. “Otherwise, you can scale GDP artificially high by spending money on things that don’t make people’s lives better.”

Democrats, who have been caught flat-footed by Trump’s avalanche of executive actions, see an opening to point figures at the GOP trifecta in Washington for looming economic woes. 

“For those keeping score, the national debt is going up, not down,” Sen. Elissa Slotkin (D-MI) said in the Democratic response to Trump’s joint address. “And if he’s not careful, he could walk us right into a recession.” 

What is a recession?

A recession isn’t just when people are uncomfortable about the economy or unhappy about high grocery prices. The main indicator of a recession is declining gross domestic product, or GDP, followed closely by the labor market.

A historical rule of thumb is that two consecutive quarters of negative GDP growth constitutes a recession, although that isn’t always the case.

GDP growth has been positive each quarter since the second quarter of 2022. GDP advanced by 2.8% in all of 2024, according to a preliminary estimate by the government.

But in a worrying sign, the Atlanta Fed’s “GDPNow” tracker predicts that GDP growth in the first quarter will fall by 2.8%, according to the latest estimate.

Also, a key measure of U.S. manufacturing activity slowed in February to near-stagnation levels, further raising concerns.

U.S. bond yields this week fell to multi-month lows, in part as a reaction to the manufacturing survey data and further bolstered by concerns about slowing U.S. economic growth and output in the year ahead.

Rep. Ryan Mackenzie (R-PA) said recession concerns are “premature,” noting that there have not been two successive negative GDP quarters yet.

He cautioned against people using recession language because the economy will be “a self-fulfilling prophecy.”

“If people are concerned about a potential recession that isn’t real at this point in time, but you start talking that up, then people actually do start pulling back their investments in the economy, start making changes economically,” Mackenzie said.

Tariffs threatening high prices

Trump campaigned on ramping up tariffs. During the campaign, some on Wall Street shrugged off the tariff threat as bluster or a negotiating tactic to exact concessions from other countries.

But this week showed that Trump isn’t bluffing on tariffs.

After a monthlong delay, 25% tariffs went into effect this week against Mexico and Canada. China has also been hit with more tariffs. Most economists argue that tariffs are inflationary as the increased costs are ultimately passed through to the consumer in a way akin to a tax.

The stock market reacted negatively and the Dow Jones Industrial Average plunged some 1,300 points on Monday and Tuesday alone, although pared back some of those losses on Wednesday.

Sen. Ted Cruz (R-TX) told the Washington Examiner that Trump’s tariffs are being used to pursue U.S. interests — such as securing the border or stopping narcotics from flowing into the U.S.

“That being said, Texas does an enormous amount of trade and commerce with both Mexico and Canada,” Cruz added. “So, it is my hope that these tariffs are very short lived and that they perform their intended function, which is to incentivize active and aggressive action by Mexico and Canada to secure our border.”

For Republicans, a recession would be politically damaging. The GOP ran successfully on lowering costs and fixing the economy in the 2024 elections, but much of the House GOP’s conference’s focus since taking control of Washington in 2025 has been on immigration and culture war bills.

With tariffs threatening to raise prices, Republicans may have a difficult time convincing voters of their promise to fix the economy in 2026, especially as the House historically flips to the party opposite of that in the White House midterm elections.

Hamrick pointed out that it has been a challenging time for the stock market given the fear surrounding tariffs.

“And that speaks to the challenges associated with the outlook and the real damage that tariffs can cause with respect to the economy and business performance,” he said.

White House downplays economic impact

Behind closed doors, White House officials voiced less confidence, spurred in part by conflicting statements made by two top members of Trump’s economic team, Lutnick, the commerce secretary, and senior counselor for trade and manufacturing Peter Navarro. 

Ahead of the presidential address, Lutnick said he expected Trump to carve out exemptions for some goods from the 25% levies placed on Canada and Mexico, suggesting they were motivated by markets plummeting for two consecutive days after the tariffs went into effect earlier this week.

On Wednesday, Trump announced a one-month exemption for the big three U.S. auto companies so that they can reshore their manufacturing facilities with minimal short-term costs.

On the other hand, Navarro, the biggest tariff hawk in the president’s council of advisers, suggested Wednesday that Trump’s tariff agenda is set in stone.

“We’ve had two days of volatility in the markets and everybody’s hair is on fire,” he said on CNN. “The problem is that every country in the world which we trade with has higher tariffs and higher non-tariffs barriers. And Canada is absolutely no exception to that. They stick it to us on lumber, they stick it to us on dairy, they stick it to us on a wide variety of products. And the president will not tolerate that anymore.”

Through Trump’s first six weeks in office, attempts by Democrats to mount an effective, organized opposition to the president’s agenda have largely failed. But party operatives largely see the daylight within Trump’s own team, worsening economic sentiment across the general public, and a lack of concrete policies to immediately address inflation as the perfect vehicle to attack the president.

DEMOCRATIC PROTESTS OF TRUMP ADDRESS DEFY JEFFRIES REQUEST FOR ‘DIGNIFIED’ RESPONSE

“A lot of people watched that speech and thought, ‘I voted for this guy because he promised to ‘end the devastating inflation crisis immediately,’” Andrew Bates, a Democratic strategist and former deputy press secretary under Biden, told the Washington Examiner. “But now he’s in power, inflation’s rising, I’m more concerned about the economy than before, and all I see him doing on my top issue is raising prices with tariffs that fund tax giveaways to the rich.”

“For a lot of people, the costs were the whole point. They don’t like a lot of the rest but held their nose,” a second veteran Democratic operative suggested. “He keeps acting like promises mean nothing, and that is not how voters feel.”

Lauren Green and Christian Datoc contributed to this report.