As I’ve said since day one of his administration version 2.0, I hope he succeeds in a lot of the policies he’s attempting but some of the economic approaches are so far out in left field that every statement, pronouncement, and executive order requires a detailed dissection.
For myself, that is sad, because I expected more this time around.
President Trump posted on Truth Social last night after the news hit the wires and he was less distracted by the war in the Middle East.
Yesterday a story appeared in the New York Post that yours truly actually missed:
Blue-collar wage growth under Trump sees largest increase in nearly 60 years, Treasury sec reveals on Pod Force One
The money quotes from the article is something else from US Treasury Secretary Scott Bessent:
“We’ve seen real wages for hourly workers, non-supervisory workers, rise almost 2% in the first five months. … No president has done that before.”
Falling inflation has driven the significant improvement in blue-collar wages, lifting workers’ take-home pay and living standards.
Bessent says wage growth is also fueled by the president’s “emphasis on manufacturing” and commitment to remove illegal migrants from the workforce.
Really?
At the White House website, the following chart was published highlighting their statements.
Sadly, the last President to really manipulate charts and data like this was Obama, which is fitting since apparently the two of them are apparently getting along just fine.
This brings us to the real story and the real facts.
Let us give Bessent the benefit of the doubt that his data series is “accurate” and honest. Except it is not. Adjusted for inflation, US workers are getting smoked and barely keeping their wages above water depending on their pay rate, where they live, and what the price of variable goods (food, energy, healthcare, utilities) impacts their monthly take home pay.
If one takes an honest look at the rate of increase or decline for the median usual weekly real earnings, the rate of pay is declining, not increasing. The gross might well be “increasing” as Bessent brags, but adjusted for inflation using 1982-84 CPI Adjusted Dollars, it’s on a negative trajectory.
In fact when one overlays the hard data with the cumulative inflation, it looks even worse.
Keep in mind, this is not “my” data, this is Trump’s BLS data and information illustrating just how week average weekly real earnings has been since before the GFC; in fact, it’s worse. It means that it is far below the rate of inflation.
So let’s use this data and do some basic math:
1.7%
–
3.2%
=
-1.5%
In other words, these great “wage” increases Trump and his team are bragging about are total bovine scattology (That’s BS for those of you in Oxnard, CA) and it means that net, US workers are still not making more money on a weekly basis which is why lower and middle class expenditures are tanking in Q2.
Buckle up because the fertilizer is only going to get spread faster and louder after today’s FOMC meeting.
