Commentary: Why a booming economy is not helping Trump - CNA

Anxiety about AI and affordability has turned US President Donald Trump's populist party into a popular target, says Ruchir Sharma for the Financial Times.

U.S. President Donald Trump delivers remarks on the economy, at the General Motors Proving Ground in Milford, Michigan, U.S. July 27, 2026. REUTERS/Carlos Osorio

NEW YORK: An American president’s party normally loses ground in midterm elections but this year is unusual. 

Economic growth accelerated sharply to near 4 per cent in the third quarter, yet Donald Trump’s approval rating is plummeting, particularly on the economy. His party is haemorrhaging support. Should it lose both houses of Congress next month, which betting markets see as a live possibility, it would be the first such defeat in economic conditions this favourable since the 1950s.

How could this happen? For many Americans, this feels like the wrong kind of boom - marred by a rising cost of living and the fact that growth is driven mainly by the wealthiest consumers and by heavy investment in AI, which the electorate has come to hate and fear more intensely than any previous tech breakthrough.

Frustration with the US economy predates both AI and Donald Trump’s second term. Most Americans have been increasingly dissatisfied about the state of the nation for decades, but the share who say the country is heading in the right direction collapsed over the past year from around 40 per cent to 20 per cent.