The U.S. stock market’s weeklong decline reversed itself dramatically on Tuesday, producing one of the strongest climbs of the year. A gain driven by strong earnings reports from bulwarks like Goldman Sachs and Johnson & Johnson pushed the market, which had lost 1,600 points in the previous eight trading days, up nearly 600 points. While the Dow Jones still sits about 1,100 points shy of its early October high, the gains have calmed fears that the nearly decade-long bull market was coming to an end.

But if Wall Street was breathing easy on Tuesday, the media didn’t notice. Instead, cable news focused on the disappearance of Saudi journalist Jamal Khashoggi, the upcoming midterm elections, and President Donald Trump’s Twitter feed, where he called his alleged former mistress “horseface.” On Wednesday, in an attempt to work the refs, Trump called out the media for ignoring the market’s gains, implying that he should be given credit for them.

But the media isn’t alone in ignoring good news about the market or the economy more broadly. After tethering himself to the stock market for most of his first year in office, Trump has distanced himself from its performance since February’s nosedive. And after spending the first half of the year planning to campaign on the $1.5 trillion tax cut passed in late-December, since midsummer congressional Republicans have all but ignored their top legislative achievement of the Trump era. It’s now clear that, far from being a boon, the tax cut is a liability for Republicans, with Democrats using it as proof of the party’s upper-crust loyalties. Handed the strongest economy since the mid-’90s, the GOP instead has decided to campaign much like its leader did in 2016: on a platform of fear.


Back in February, Republicans planned a midterm strategy centered on the $1.5 trillion tax cut (which they promised, to much skepticism, would reduce the deficit) and on the strong economy (which they had inherited from President Barack Obama). “The tax bill is part of a bigger theme that we’re going to call The Great American comeback,” National Republican Congressional Committee chairman Steve Stivers told Bloomberg. “If we stay focused on selling the tax reform package, I think we’re going to hold the House and things are going to be OK for us.” In the weeks and months after the Tax Cuts and Jobs Act was narrowly enacted, Trump and other Republicans relentlessly flaunted the law as evidence of the party’s fiscal bona fides.

The message was supposed to be simple. “Congress has reached an agreement on tax legislation that will deliver more jobs, higher wages and massive tax relief for American families and for American companies,” Trump promised after congressional Republicans finalized the bill in December. Concerns about the potential adverse effects of passing a $1.5 trillion tax cut during a rosy economic period—namely that it would balloon the deficit—were dismissed, despite the presence of numerous nonpartisan studies arguing that the national debt would increase by as much as $2 trillion. White House Budget Director Mick Mulvaney told CNN he thought the bill “actually generates money,” while Treasury Secretary Steven Mnuchin argued “the plan will pay for itself through growth.” Senate Majority Leader Mitch McConnell told reporters, “We fully anticipate this tax proposal in the end to be revenue neutral for the government, if not a revenue generator.”

While the tax cut appeared to add rocket fuel to a booming stock market, Republicans were never able to connect it to perceptions about the overall health of the economy. Most voters, a recent Gallup poll show, do not discern any change in their economic well-being tied to the tax cut, while an internal GOP Bloomberg poll found that voters, by a two-to-one margin, believed the cuts favored corporations and the wealthy. Democrats were more effective in messaging and instead reframed the law as what it (mostly) was: an unnecessary giveaway to corporations and the rich. “In terms of the bonus that corporate America received versus the crumbs they are giving to workers, to kind of put the schmooze is so pathetic, it’s so pathetic,” House Minority Leader Nancy Pelosi said in a January press conference. Republicans pounced at the time, thinking they had caught Pelosi making an elitist remark. But nearly a year later, many voters agree with Pelosi.

On Tuesday, the Treasury Department announced that the deficit had increased by nearly $800 billion—a jump of 17 percent—thanks in large part to declining tax revenue. The leap was the largest since 2009, at the height of the Great Recession. In April, the CBO released a report finding that the deficit would hit $1 trillion by 2020—two years earlier than initially thought. The rising deficit has caused Republicans, predictably, to call for entitlement reform—meaning cuts to Medicare, Medicaid, and Social Security. Ever the cynic, McConnell this week deflected reports that the GOP tax cut was driving the debt increase and instead suggested that entitlement programs were the real deficit busters. “It’s disappointing, but it’s not a Republican problem,” McConnell told Bloomberg on Tuesday. “It’s a bipartisan problem: Unwillingness to address the real drivers of the debt by doing anything to adjust those programs to the demographics of America in the future.”

But this has only fueled Democratic midterm messaging about potential GOP cuts to social spending. “Sen. McConnell gave the game up in his comment yesterday,” Maryland senator Chris Van Hollen, who chairs the Democratic Senatorial Campaign Committee, said in a press call on Wednesday. “It was very clear from what he said that a vote for Republican candidates in this election is a vote to cut Social Security, Medicare and Medicaid. That’s what he said.”

With voters dismissing the meager benefits the tax cut bestowed on them, and the deficit ballooning, Republicans can’t claim ownership of an economic boom that’s been years in the making. So instead they’re embracing Trump’s 2016 playbook: fear-mongering over Muslims, immigration, and crime. In the wake of the protests against Brett Kavanaugh’s confirmation to the Supreme Court, Republicans have argued, sometimes explicitly, that they must be kept in power to preserve the rule of law—that Democrats will burn everything to the ground if they’re put in charge. “You don’t hand matches to an arsonist, and you don’t hand power to an angry, left-wing mob, and that’s what they have become,” Trump recently said.

Republicans also may be realizing what Hillary Clinton’s campaign realized too late in 2016: The economy is strong by most metrics, but millions of voters don’t see it that way. Though the economy Trump inherited was booming, its gains were being reaped unequally—that’s partly why he won. Touting a strong economy to voters who have been left behind is far from a winning strategy, especially after passing a tax cut for the rich that has only made that inequality more pronounced.

All of this may be beside the point. Republicans hurried to enact the Tax Cuts and Jobs Act in part to please their donors, whose help they needed to fend off a blue wave in 2018. Sure enough, donors like Sheldon Adelson and the Koch brothers have opened their checkbooks, but Republicans are getting pummeled in fundraising in dozens of competitive districts: Democrats have out-raised Republicans in all 30 “tossup” races, according to FEC data released on Tuesday. Still, that money has done nothing to boost Republican efforts to sell the economy or the tax bill. “Their messaging has been extremely poor,” Steve Moore, who served as an economic adviser to Trump’s 2016 campaign, told The Washington Post. “We’ve got the best economy in 25 years and they aren’t really talking about it. They are letting Democrats control the messaging.”