The Trump administration inherited a fully employed economy, but one showing most leading indicators (except the stock market) flashing yellow or red. Nearly eight months into his term, that’s still the case—only more so.
Given the fundamental backdrop, we’ll be more than stunned if a recession doesn’t break out between now and the end of Trump’s term in January 2029. There’s also a bit of political history working against Trump. In the last 100 years, only a single Republican presidential term concluded without the economy falling into recession (Reagan’s second term). Since 1925, twelve recessions have begun under Republican administrations (note there were two during Eisenhower’s second term) compared to just four under the Democrats. Since 1952, Republican terms have accounted for 10 of the last 11 recessions.
Party loyalists can obviously have a field day with this data. Democrats can simply cite the hard stats. Republicans might counter that the policies of a prior Democratic administration set up the economy for failure. Indeed, four of the 12 recessions under Republican administrations occurred in the first year after wresting control of the White House from the Democrats (1953, 1969, 1981, and 2001).
Hyper-partisans are free to use or abuse these statistics in any way they wish. (But when confronting hyper-partisans of the opposite persuasion, please refrain from citing my name or my company’s name as the source.)
As suggested above, the first year of a term—whether it’s a White House incumbent or new occupant—has shown heightened recession risks. Half of the 16 recessions since 1925 began during the first calendar year following an election. The implication is that stimulative policies aimed at keeping the incumbent party in power—be they successful or not—frequently produce economic hangovers.
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