February 20, 2026
I promise I’m not trying to pile on to President Trump’s bad day — but he also got some other bad economic news today – I mean, besides the Supreme Court saying his emergency tariffs were illegal.
Today – the commerce department said the gross domestic product – for the fourth quarter of 2025 was much lower than economists predicted… it was only up 1.4%. That’s down from two solid quarters of growth. In the third quarter of 2025 the GDP was 4.4% and the GDP was 3.8%in the third quarter. For the record we saw the first shrinking of our economy in three years in the first quarter of 2025 when Trump first took office.
Today’s 4th quarter number brings the overall GDP for 2025 to 2.2% which is down from 2024 when the GDP was 2.8% and down from 2023 when the GDP was 2.9%. The GDP just so we’re clear is the measurement of the total monetary value of all goods and services produced within a country’s borders during a specific period of time.
So what’s going on? According to the commerce department – the biggest factor in this GDP slowdown was the government shutdown – which was the longest in US history. You can see in this chart government spending plummeted by 16.6% in the fourth quarter. This morning President Trump blamed the Democrats for that posting that in his mind that shutdown – cost his GDP two points. But we also saw a slight slowdown in exports.
So what’s propping up the US economy? Your. Spending. Consumer spending – which is traditionally strong because Americans like to buy stuff. However – what we are seeing in this report is that spending – while propping up this entire economy in the fourth quarter — is slowing down. In 2024 consumer spending was 2.9% and according to today’s report – in 2025 consumer spending was 2.7%. There’s another caveat to this consumer spending number that you need to understand. Most economists believe the consumer spending is high – not because everyone in this country is doing well and able to spend – they believe it’s high because the wealthiest Americans are spending – they call it a k-shaped economy – meaning this economy is working really well for wealthy Americans but for middle, working and lower class Americans – it’s just not
Read the Q4 GDP report here.
