Material reality, or kitchen table issues such as groceries and rent, shapes ideology and systemic thinking about the political economy of living and working. The current moment of social tumult has been gathering steam since the end of the Vietnam War, which heralded the sunset of a postwar U.S. economy of broad-based prosperity.
Dubbed neoliberalism under successive Democratic and Republican presidents, a political economy of corporations and the wealthy lobbying for and receiving government help to snag profits and market share has ruled the roost of U.S. society. That government intervention, from copyrights and patents to misnamed free trade pacts, favors big business and investors, a system that the current president seems hellbent on disrupting while claiming to deliver a renewal of the American dream. President Trump didn’t begin this class war of a few against the many.
Meanwhile under neoliberalism the poor and working class receive crumbs. That governing system is also known as austerity. There’s an old wine in new bottles angle. That is Trump’s Department of Government Efficiency (DOGE), promising “efficiency” under the brilliance of Elon Musk, a poster boy for government contracts and subsidies. Here are some relevant details of what he got for campaign donations to the president. Here are some details from the Economic Policy Institute, based in Washington, DC.
“By removing certain ethical requirements for civil servants, appointing Musk as a “special government employee,” and granting DOGE unprecedented access to sensitive government data, Trump has created multiple avenues for Musk and his team to exploit their political positions for their own personal gain. If Musk leveraged his access and influence to double the value of federal contracts awarded to his companies, he would capture $23.6 billion in federal spending.”
Meanwhile, spending cuts for poor and working families, forced to struggle for defunded New Deal and Great Society programs of social uplift, has been and remains in force. Project 2025 is a bid to exterminate the last remnants of a governing system that patches up the harmful impacts of a for-profit economy on tens of millions of Americans.
Neoliberalism, on anabolic steroids and human growth hormone under the current U.S. president, aims to accelerate a trend of income and wealth concentration at the top. One example is illustrative. The Internet was supposed to spur entrepreneurship among small merchants as it expanded over a generation ago. Instead, the Internet has become a vehicle for corporate monopolies to dominate online activity, thanks to the government’s guiding hand. The behemoths of Big Tech: Alphabet, Apple, Amazon, Meta and Microsoft are cases in point. Jeff Bezos, head of Amazon, feasts on fat contracts with the military-industrial complex after getting a sales-tax pass to wreck mom-and-pop shops that got no such help. Government-granted copyrights paved the way for Bill Gates of Microsoft to become a multi-billionaire.
Speaking of government intervention into the marketplace, America’s consumers and small businesses are facing the adverse impacts of Trump’s tariffs. Consider empty container cargo ships arriving stateside. China, one of the top three trading partners of the U.S., is changing its ways of doing business with America. That means the regular and usual supply of goods from China that are available to American consumers and businesses is set to change. A shrinking supply of goods means increasing prices. This law of the marketplace holds for a broad swath of commodities, from affordable rental housing to home sales and the Chinese-made consumer goods with increased prices on the shelves of The People’s Republic of Wal-Mart, Inc. Businesses will pass on the higher prices of tariffs, which are taxes that the government collects on imported goods.
Small business owners and the consumers they serve like price stability. Predictable pricing is central to their commercial relationship. Take Gladys Harrison. She owns Big Mama’s Kitchen and Catering in Omaha, Nebraska. She fears for herself and other small business owners facing backbreaking price hikes, absent tariff relief.
“One of the staples of our restaurant is oven fried chicken,” according to Harrison, “with a special blend of seasonings that come from other countries. I’m looking at paying between 25% to 145% more for the seasonings with the tariffs. We’re having to think about passing the higher cost onto our customers, which will make our food unfordable.”
By contrast, Trump’s administration has allowed smartphones and related electronics to get a pass on import tariffs. Chalk up a win for Apple. Big fish and small fish swim in different waters. A double standard applies to global trade under the current presidential administration.
We turn to Meet the Press of May 4, 2025. Here is President Trump, commenting on the harmful impact upon the small businesses of America from his tariffs on China. “Why do you always mention that, you know that you pick up a couple of little businesses. What about the car business? They are going to make a fortune because of the tariff. So why don’t you mention the big car industry instead of mentioning somebody doing strollers?” (Meet the Press, 12:16)
Frank Knapp, Jr. heads the South Carolina Small Business Chamber of Commerce. “The president of the United States has shown utter disrespect for the small businesses of this country,” according to him. “We employ half of all workers and are responsible for all net new jobs in this nation. Yet, the president only seems to care about how his policies impact big business.
“Small businesses are being hurt by numerous policies this administration has put in place. But apparently that is of no consequence to the president. The next time he or someone in his administration uses the tired old phrase, “Small businesses are the backbone of this country,” all of us should remember that the president doesn’t really care about our “little business stroller” class.”
It remains to be seen what the next steps for price stability in bilateral trade will be during upcoming talks between Chinese and U.S. officials in Switzerland. Meanwhile, inconvenient yet related facts confront a Trump administration of, by and for a billionaire class linked to voters who lack such mega-wealth. Think global finance. Japan is the largest foreign creditor of the U.S. China is number two, holder of $784 billion of Treasury securities in February, federal data shows.
Japan and China, an ally and foe, according to a bipartisan consensus, are the leading nations that buy federal debt. That debt exists for two main reasons. First is the massive U.S. defense budget. A bipartisan consensus to finance U.S. wars–directly or by proxy–with borrowing instead of taxing. Last is the fact that this outsize debt would vanish if the federal government collected an adequate amount of taxes from America’s billionaires and corporations. This is a policy option dead on arrival since these same deep pockets of wealth fund Democrats and Republicans.
Turning to April’s U.S. jobs report, it shows labor employment relatively unchanged. However, a total picture of Trump’s attacks on federal spending and federal workers is yet to arrive. Take the latter. “The devastation to the federal workforce has yet to be fully realized in these data because many workers are on administrative leave (on the payroll), and more recent federal UI (unemployment insurance) claims data suggest further cutbacks,” according to economist Elise Gould of the Economic Policy Institute.
To be clear, unemployment slows growth, the sine qua non of capitalism. That correlation between employment and expansion points to adverse economic impacts of cutting federal payrolls. Cutting federal spending on consumer watchdogs likewise impacts the poor, working class and small businesses facing, say, a weakening of financial regulation that protect them from predation. Trump’s attack on the Consumer Financial Protection Bureau, an independent agency of the American government, is a case in point. The CFPB investigates fraudulent lenders to hold them financially and legally and accountable.
Unemployment also reduces the amount of money that workers have to spend on goods and services. That’s a negative for businesses. Smaller businesses are more at risk from a drop in consumer spending for this simple reason. Mom-and-pop enterprises have less capital to fall back on than big companies during economic downturns. Big firms can lose money and keep their doors open for business. Small businesses can’t do that.
Then there is the question of where fired federal workers will seek new employment. The answer is the private sector, where the ranks of job-seekers will rise. Where else can they go? Yes, there are state and local government employers, but we’re talking about a small fraction of U.S. employers.
Further, states and local governments are facing federal spending cuts under DOGE. That’s austerity knocking at the door, removing money from the economy. The math of this move does not create a landscape for new hiring to rise and buy goods and services from small businesses.
All things equal, when there are more workers applying for jobs, meaning supply exceeds demand, wage income tends to remain flat. Wages are the main source of income for workers. As they face higher prices from the president’s economic policies, there will in all likelihood be a slowdown in consumer spending. That further weakens demand for goods and services absent debt-driven spending.
Drum roll, please. Enter government spending to stimulate the marketplace. This intervention boosts spending or demand for goods and services. Reducing or removing government spending weakens demand via removing money from the economy. The math of this equation is straightforward.
Dealing with federal spending cuts that reduce services for businesses and the customers they serve, while prices for imported goods rise, will squeeze the American population. To be sure, some cast votes for Trump in 2016 and/or 2024. How such voters and of course non voters, with college degrees or without, come to understand what is at stake and why around kitchen table issues of living and working is unclear.
Trump’s bid to blame immigrants without documents and foreigners generally for all things harmful stateside has limits, as does the domestic consent behind his popularity. America in 2025 isn’t Germany or Italy in the 1930s. The U.S. went left during that depression-decade, thanks to communist, labor and socialist movement politics. That grassroots coalition won the day, defeating a right wing of big business and the wealthy opposed to paying higher taxes for FDR’s New Deal. Looking forward from the current politics and economics of chaos, a future path is unwritten. As Mark Twain is credited with sharing, history doesn’t repeat itself, but it often rhymes.
