Time is short, and Trump is betting everything on one word: prices. With less than a year to the 2026 US midterms, he tells Politico the outcome will ride on “our country’s success,” and “the key is the issue of prices”—pinning today’s inflation pain on the Biden administration while promising he’s pushing costs down. But even with better-looking headline numbers, Americans still feel squeezed, and Republicans stare at weak polling and the real risk of losing Congress.
Even with better numbers, Americans still feel the squeeze—and that’s the real headline.
He sells the story like a man doing a victory lap. Trump repeatedly hypes his economic “report card,” zeroing in on energy: “Energy prices are down dramatically, gasoline prices are down dramatically… everything is down… down very beautifully.” He also waves around the 4.3% annualised GDP jump in the third quarter and cracks that “the Democrats are going to explode—their heads are about to blow off.”
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Even with better numbers, Americans still feel the squeeze—and that’s the real headline.
Trump sells “energy is down” like a cure-all.
The White House has stats to spin—but voters don’t live in spreadsheets.
The viral China–US comparison hits a nerve: US “must-pay” bills leave families boxed in.
Trump sells “energy is down” like a cure-all.
And yes, the White House has numbers it can plaster on every podium. Commerce Department data shows third-quarter GDP growth is the fastest in two years; Labour Department CPI data shows November inflation cools to 2.7% year on year, the lowest since July. The administration is clearly trying to turn those figures into a simple message: Trump is fixing the cost-of-living crunch.
But here’s the catch: data can cool while wallets still burn. A Politico/Public First poll last month finds nearly half of respondents still struggle with basics—daily necessities, utilities, healthcare, housing and transport. A Christmas-season poll from centrist think tank Third Way looks even uglier: 60% say the economy is not growing, 66% think unemployment is rising, and on cost-of-living competence Democrats lead 42% to Republicans’ 31%.
The White House has stats to spin—but voters don’t live in spreadsheets.
The “rigid spending” trap
The real problem isn’t just inflation—it’s what Americans can’t stop paying for. A widely shared China–US cost-of-living comparison argues that many “must-pay” items in the US tower over China’s, leaving ordinary families with almost no wiggle room. It claims electricity costs are about 11 times higher in the US (roughly US$110 per person per month versus US$10 in China), with water bills also around 11 times; on housing, it points to property taxes where US$10,000 a year is described as common, plus homeowners’ association fees of about US$100 to US$300 a month—putting property-related costs at roughly five times.
Then comes the heavyweight punch: healthcare and insurance. The same analysis says US health insurance premiums average about US$550 a month—more than five times China’s per-capita level—and that’s before out-of-pocket bills that can climb fast. It also claims annual per-capita healthcare spending hits US$13,000, exceeding China’s per-capita GDP; and on car insurance it says Americans’ per-capita spend is 15 times China’s, with drivers facing a burden about three to four times heavier.
Yes, Americans make more on paper—but the bills eat that advantage alive. The analysis says nominal pre-tax US income is more than 10 times China’s, and after-tax take-home is about six to seven times, but services that cost 10 times more can erase that quickly. Because so many US costs are “rigid,” cutting them often means a serious lifestyle cliff—or worse, homelessness—while in China, people often have more discretionary spending they can pause when income drops, giving stronger shock resistance; the result is “edge” US middle-class families watching big money flow in and out with little left, and a job loss or surprise expense can trigger a fast social “downward fall.”
The viral China–US comparison hits a nerve: US “must-pay” bills leave families boxed in.
Politics feels the squeeze
That anxiety is already turning into votes—and it’s not great news for Republicans. Democrats have notched strong results in recent local elections, winning key posts like New York City mayor, New Jersey governor, and Virginia governor, boosting morale and injecting uncertainty into next year’s midterms. Trump seems to smell the smoke: he’s trying to reframe “affordability,” moving from calling it a Democratic “scam” to blaming Biden for price spikes and insisting he’s the one bringing them back down.
He’s also pushing for rule changes to bulldoze his agenda through. On the 27th, Trump again urges Senate Republicans to scrap the filibuster, calling it “an obstacle that holds back the American government,” and claims removal would stop shutdowns and enable “excellent healthcare.” But multiple Republicans—including Senate Majority Leader John Thune—push back, arguing the filibuster is a key institutional safeguard, and the government still faces another shutdown risk in January next year.
In the end, Trump’s toughest job isn’t citing statistics—it’s changing what people feel at the checkout line. Building a bridge between “official data” and live experience, and persuading voters that prices are truly under control, becomes the administration’s biggest midterm test. And it will help decide, directly, whether Republicans keep their grip on Congress.
Deep Throat
** The blog article is the sole responsibility of the author and does not represent the position of our company. **
Steven Rattner just got back from China, and he's not mincing words. The former Treasury advisor under Obama published a stark assessment in The New York Times on February 10 with a title that lands like a gut punch: "I Just Returned From China. We Are Not Winning."
Rattner spent a week on the ground touring AI labs, EV factories, robotics firms, and pharma companies – and what he documented should terrify anyone betting on Trump's tariff strategy to slow Beijing down. The reality is blunt: China is leaping ahead in cutting-edge sectors from artificial intelligence to humanoid robots, and slapping duties on imports won't change that trajectory one bit.
A Treasury insider issues a blunt warning: Steven Rattner documented China's technological surge in The New York Times.
Washington's China Delusion
A few weeks back, Rattner sat through a New York dinner where senior trade experts argued over China strategy. Some backed Trump's confrontational playbook – tariffs, export bans, the works. Others pushed for traditional diplomatic engagement. Rattner, who's been investing in China for years and had just wrapped his week-long tour, dismissed both camps outright.
Steven Rattner
Make no mistake: neither approach will work, because China is both a formidable competitor and an irreplaceable manufacturing hub. You can't negotiate or bully your way around that. The only real path forward? America needs to fix its own broken house and outcompete China where it actually has advantages – not chase phantoms with tariff threats.
Rattner pulls no punches on Trump's first year back in office: the chaos has already set America back. Beyond manufacturing, China now threatens US dominance across fast-growing industries – artificial intelligence, pharmaceutical R&D, advanced robotics. The turbulence from the White House isn't just noise; it's actively undermining American competitiveness while Beijing executes a coherent industrial strategy.
Power and Talent: China's AI Edge
What Rattner saw in AI left him shaken. Sure, the US still leads in cutting-edge semiconductor chips, but China controls something more fundamental – electricity. China's power generation capacity exceeds America's by more than double, yet data center electricity costs run half of US rates. When the foundation of AI infrastructure is cheaper and more abundant in Beijing than in Silicon Valley, the math gets uncomfortable fast.
But the real secret weapon is human capital. Rattner met waves of young Chinese entrepreneurs whose drive and intellect match any Silicon Valley cohort – including one billionaire still sleeping in his office. That's not anecdote; it's evidence of a system channeling massive ambition into strategic sectors while America argues about tariff percentages.
Obama-era advisor pulls no punches: Rattner (right) with former President Obama (left) – now delivering hard truths about America's competitive decline.
And despite Trump's tariff offensive, the numbers don't lie: China posted a record $1.2 trillion trade surplus last year. It remains the world's export champion, proving that tariffs haven't dented global reliance on Chinese manufacturing. Everyone still depends on "Made in China" – with or without duties.
Electric Shock: Xiaomi's Five-Year Leap
Consider automobiles. Rattner toured Xiaomi, a company that made smartphones and electronics five years ago and only announced its EV push in 2021. What he witnessed in that factory reads like industrial sci-fi: "gigantic machines resembling mechanical dinosaurs effortlessly and precisely fitting aluminum body parts into vehicles on a production line in a massive factory where workers were barely visible". In the showroom sat a yellow sports car that could pass for a Porsche.
Five years from phones to Porsches: Rattner witnessed Xiaomi's stunning leap into electric vehicles – a timeline that should alarm Detroit.
Ford CEO Jim Farley admitted last summer that Chinese in-car technology is "far superior" to American models, calling China's progress "the most stunning experience I've ever seen". Shortly after, Ford halted production of its F-150 electric truck and took a brutal $19.5 billion write-down on EV projects. That's not a data point – it's a white flag.
Robots and Drugs: The Next Frontiers
Rattner also visited a robotics firm where plastic-toy-like devices moved fluidly across the floor, demonstrating progress in humanoid robots designed to replace specific human tasks. The scale is staggering: in 2024, China installed nearly nine times more industrial robots than the United States.
The humanoid revolution is here: Rattner toured Chinese robotics firms racing ahead in automation while America debates tariffs.
In pharmaceuticals, the reversal is just as stark. A few years ago, China was still licensing drug patents from overseas companies. Now China licenses more drugs outward than it imports, and its clinical trial volume has overtaken America's. That's a complete inversion of the innovation hierarchy in less than a decade.
Beijing's Strategic Edge
Rattner credits China's technological surge to effective government coordination. When Beijing recognized it was falling behind in AI, it declared catch-up a "national priority" and delivered – funding research, relaxing regulations, and building massive power capacity with visible results.
Even under ideal conditions, competing with China would be daunting. But the reality is far from ideal: Trump's erratic policies have placed America in an extremely disadvantageous position. The US needs to rethink industrial policy and mobilize government resources for strategically critical industries – something the current administration shows no sign of doing coherently.
Fix America First
The first step? Reverse Trump's cuts on scientific research and other critical areas. Rattner admits he's skeptical about democratic governments picking corporate winners, but insists "we no longer have the luxury of confining Washington to the sidelines". America should focus on future industries – not Trump's nostalgic fixation on traditional metal-processing manufacturing.
On critical minerals, America's constraint isn't scarcity – it's a byzantine approval process for mining and processing facilities that strangles domestic production. Regulatory gridlock, not geology, is the bottleneck.
Rattner's bottom line is unambiguous: Trump – or anyone else – must face one fact: imposing tariffs or chasing trade deals simply cannot defeat China. To surpass China, it has to “begin at home”, by “getting our own economic house in order". He urges Trump to scrap the suite of ineffective policies he's rolling out.
This isn't the first time Rattner has sounded this alarm. Last December, he told Bloomberg the same thing: to beat China, you can't rely on export controls or trade measures to "slow China's development pace". "America can neither defeat China on the battlefield nor at the negotiating table," he emphasized, insisting America's only option is to do its own work better.
