Outgoing Republican: ‘What We’re Seeing Is Basically a Recession Economy in Nebraska and Iowa’

Bacon pointed to last month’s figures showing that Nebraska’s economy constricted by six percent, the kind of number that gets you fired in Trump’s world now. But again, Trump’s issue is that he is his own biggest problem, and his trade war hurts export-driven state economies, as the tit-for-tat tariffs push businesses in our major trading partners towards cheaper countries not self-immolating for the hell of it. As of Trump’s post-August 1st deadline that got pushed back for China and Mexico, the largest tariff imposed is 50 percent on Brazil. After Syria (41 percent), Laos (40 percent), Myanmar (Burma) (40 percent), and Switzerland (39 percent), Canada has the next largest tariff at 35 percent. After Iraq and Serbia at 35 percent, China leads the pack of countries at 30 percent, then Mexico at 25 percent. The latest deals with the European Union and Japan to establish tariff rates at 15 percent have helped their automotive industries get a head start, primarily on the American automotive industry who produces many of its parts in Canada and Mexico (although Trump is now saying that if the EU doesn’t make good on the impossible fuel magic he invented, their rate will go up to 35 percent).

Most states export to one of those aforementioned countries with some of the largest tariffs in the world imposed on them. And it’s not the blue states and localities being harmed like how Trump is targeting with his assault on universities. Of the top ten states with exports comprising the largest percentage of their GDP, seven are deep red states, and eight (Michigan) voted for Trump in 2024. Of the 28 states where exports comprise the largest percentage of GDP, Canada is the largest market for 17 of them. Trump’s trade war with Canada will hurt all of those economies, perhaps more than Canada’s.

“And Canada, there’s so much anger towards Americans right now,” said Bacon. “We’re losing lots of business, lots of customers, lots of tourists. I feel like there’s some consequences to this tariff policy that we’ve not felt yet, but we will.” If you’re wondering why Trump is firing statisticians in the grandest assault on the fundamental confidence in the American economy in its history, it’s because those statisticians are starting to produce data where even Republicans can see how Trump’s economy is in not in great shape, and without massive AI capital expenditure spending that comprised more of American GDP last quarter than consumer spending, it may be so weak as to spark a recession.

Trump can fudge the numbers all he wants but when an economy pulls back six percent, people feel it. We all know where this is going. Hiring doesn’t slow down in good economies. As long as Trump’s hurricane of uncertainty envelops our economic world, businesses and consumers will cut back to varying degrees. If Trump is going to undermine confidence in the bedrock of our economy, known statistics about it, then it’s not a matter of if, but when that leads to an economic crisis of some sort. Republicans like Bacon understand all of this, but only when they announce their retirements.