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In a Fox News interview on Sunday morning, Kevin Hassett, director of the National Economic Council, disregarded Americans’ current ill feelings on the economy, instead suggesting that factors like rising prices are proof that Americans are “optimistic.”
“People are spending more on gas, but they’re also spending more on everything else,” Hassett claimed in the interview. “Not just groceries but restaurants. That’s a sign that you would see when people are optimistic about the future.”
Hassett’s view of the economy is likely distorted by the spending activities of wealthier Americans, who are not as affected by higher costs on goods as middle-class or low-income households. Indeed, many economists are describing conditions today as a “K-Shaped Economy,” wherein the financial situation of those with higher incomes improves while the rest of the country struggles.
Hassett was also asked about credit card usage, including recent reports that show a 13 percent delinquency rate for current cardholders, the highest level seen in the past 15 years. Hassett shrugged that problem off, citing conversations with credit card companies — rather than with consumers facing difficulties.
“We talk to CEOs of the credit card companies all the time, and we do see some increased stress [among consumers],” Hassett said. “But, for the most part, delinquency is different than default.”
“There’s not any threat to the credit card companies,” Hassett added.
Polling demonstrates Americans don’t see eye-to-eye with Hassett’s rosy views.
According to a Gallup survey published on Tuesday, just 16 percent of Americans say they are “fulfilled” financially right now, meaning their finances “support the life they want to have.” Conversely, 32 percent of Americans define themselves as financially “stressed,” meaning they are “straining to meet obligations, needing to make trade-offs between financial and life goals, and feeling they lack control over their financial situation.”
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, 4 in 10 Americans (42 percent) rate the economy as being “poor,” while only 2 in 10 (20 percent) say it’s in “excellent” or “good” condition. Another 3 in 10 Americans (34 percent) say the economy is only in a “fair” state.
On top of those numbers, only 15 percent say the economy is “getting better,” while another 20 percent say it’s “about the same” as it was before the current period. Nearly 6 in 10 Americans, 59 percent, said things are “getting worse.”
The federal government’s own numbers contradict Hassett’s optimism, confirming what Americans are feeling — that prices are increasing at a troubling rate. For example, the Consumer Price Index (CPI) report for April, released early last month, showed that prices on all goods increased, year-over-year, by 3.8 percent, outpacing increases in average wage gains for workers.
“This is hurting Americans. There is a real financial squeeze underway,” and it’s a “setback for middle-class and lower-income households,” said Heather Long, chief economist at Navy Federal Credit Union, in response to the report.
Hours after the April CPI report’s publication, Trump was asked by reporters whether increases in prices influenced his negotiation tactics for the war in Iran. Trump’s answer suggested he was uninterested in how Americans viewed the economy under his watch.
“Not even a little bit…I don’t think about Americans’ financial situation,” Trump said.
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