Americans are deeply frustrated with Donald Trump right now, largely because of one thing: the cost of living. On the campaign trail last year, he promised voters angry about inflation that, if elected, he would slash energy and electricity bills and “rapidly drive prices down and make America affordable again.”
That has not happened. The cost of living has continued to rise since he took office—annual inflation is now 3 percent, up from 2.9 percent in 2024—and public anger has caught up to the levels Joe Biden once faced. In a CBS News/YouGov poll released over the weekend, 64 percent of respondents said they disapproved of Trump’s handling of the economy, and 68 percent disapproved of how he is dealing with inflation.
Trump’s instinctive response has been to deny the problem. “We don’t have any inflation,” he claimed earlier this month. He also insisted, “Our prices are coming down very substantially on groceries and things.” But voters can see their own bills.
They know what they are paying for beef, electricity, and everyday necessities, and they are not feeling relief. That reality has forced the administration to float some policy ideas on inflation—plans that, even if they somehow became law, are more likely to worsen the problem than solve it.
One major obstacle for Trump is that his signature economic policy—raising tariffs on imports from nearly every country—has pushed prices up, not down.
He could try to ease inflation by rolling back those tariffs (he has already trimmed duties on some food imports such as coffee, beef, and bananas). But Trump is deeply attached to tariffs as a political and economic tool. Instead of abandoning them, he has proposed sending Americans $2,000 “dividend” checks funded by tariff revenue.
There is a basic math problem with this idea: there isn’t enough tariff money to pay for it. Sending $2,000 to most U.S. households would cost far more than the government has taken in from tariffs so far. In practice, the plan amounts to injecting hundreds of billions of dollars in deficit-funded stimulus into the economy. That kind of large, debt-financed cash transfer would tend to fuel inflation, not bring it down.
Trump has taken a similarly short-term approach to health insurance. Many Affordable Care Act subsidies are set to expire at the end of the year, which means millions of Americans could see their premiums jump. That looming deadline has renewed public focus on how expensive health care is overall.
Designing a system that keeps coverage affordable for young, healthy people while also protecting older Americans and those with preexisting conditions is an extremely complex policy challenge.
Trump has shown little appetite for that complexity. His preferred answer is to repeal the ACA and “just give people money” so they can “negotiate and buy their own, much better, insurance.” Direct payments may sound appealing, but they do not guarantee access to reasonably priced coverage—especially for someone like a 55-year-old with diabetes, who faces high medical risks and steep premiums. Rather than solving the affordability crisis, this approach could push many people out of the insurance market altogether.
Housing is another major source of anxiety. Rents have surged across the country, and prospective buyers are finding it harder than ever to purchase a home. The core issue is supply: high construction costs, elevated interest rates (which discourage current homeowners with low-rate mortgages from selling), and strict zoning and building rules that limit new housing. Trump’s latest housing proposal does not confront any of these structural problems. Instead, he has floated the idea of a 50-year mortgage backed by the government.
At first glance, a 50-year mortgage might sound like a solution, because stretching payments over a longer period reduces the monthly bill. But the trade-offs are severe. Extending a $350,000 mortgage at today’s interest rates from 30 to 50 years would add roughly $350,000 in extra interest over the life of the loan. Homeowners would be building equity at a glacial pace.
After 15 years of payments on a 50-year mortgage, they would have paid down less than 10 percent of the principal—an arrangement that, in economic terms, is not much different from long-term renting. If homeownership is supposed to be a reliable path to building wealth, a 50-year loan pushes that goal further out of reach.
What such a program would definitely do is pull more buyers into the market by making it easier to qualify for a mortgage based on monthly payment alone. That extra demand, without a corresponding increase in housing supply, would tend to push home prices even higher. As with his other inflation ideas, this proposal threatens to intensify the very problem it claims to address.
It’s not hard to see why Trump is offering these quick-fix solutions. Voters now blame him directly for high living costs—in part because he explicitly promised to bring prices down—so he feels pressure to act. But if these schemes were actually implemented, they would likely deepen public frustration. In the recent off-year elections, Democrats hammered Republicans for failing to ease the cost-of-living squeeze and won big as a result. Trump’s current approach all but invites them to keep running that playbook.
