Trump Team in Overdrive to Defend Him as Economy Officially Shrinks

Peter Navarro, one of Donald Trump’s top economic advisers, doesn’t think the news that U.S. gross domestic product shrank during the first quarter of 2025 is of any concern. In fact, he thinks the economy is doing well right now, aside from those tariffs.

“I gotta say just one thing about today’s news: That’s the best negative print I have ever seen in my life, and the markets need to, like, look beneath the surface of that,” Navarro said on CNBC Wednesday, adding that if one removes “the negative effects of the surge in imports because of the tariffs, you have 3 percent growth. So, we really like, uh, where we’re at now.”

Navarro’s words are quite a crazy spin on some rather negative economic news. The GDP fell 0.3 percent during the first three months of the year, the first quarter of negative growth since the beginning of 2022, and it’s all thanks to Trump’s ill-conceived economic moves.

Trump’s tariffs led to a surge in imports as companies tried to get ahead of them, consumer spending slowed, and federal government outlays declined thanks to the administration’s massive cuts spurred on by Elon Musk’s Department of Government Efficiency.

“Maybe some of this negativity is due to a rush to bring in imports before the tariffs go up, but there is simply no way for policy advisors to sugarcoat this. Growth has simply vanished,” Chris Rupkey, chief economist at FwdBonds, told CNBC.

Navarro is trying to sugarcoat the news because he is the main architect behind Trump’s tariffs. The disgraced economist served four months in prison for contempt of Congress after he refused to testify about the January 6 Capitol insurrection. Navarro has every incentive to claim things are going according to plan, even as the market slides, and he has the support of a stubborn president behind him.

A federal judge freed Mohsen Mahdawi, a Palestinian student leader at Columbia University, on Wednesday.

Mahdawi, a U.S. permanent resident who has lived in the country for more than a decade, was arrested earlier this month as part of a trap set by U.S. Immigration and Customs Enforcement, who detained him at an immigration interview that Mahdawi believed would be his last step in obtaining U.S. citizenship.

“The two weeks of detention so far demonstrate great harm to a person who has been charged with no crime,” U.S. District Judge Geoffrey Crawford said at a hearing Wednesday. “Mr. Mahdawi, I will order you released.”

Crawford ordered Mahdawi’s release on bail pending the resolution of his habeas petition, noting that the 34-year-old had received letters of support from more than 90 community members, including people of the Jewish faith, consistently describing him as “peaceful.”

Outside the courtroom, Mahdawi raised his hands above his head, sharing an uncomplicated message to the Trump administration.

“I am saying it clear and loud,” Mahdawi said. “To President Trump and his Cabinet: I am not afraid of you.”

“What we are witnessing now and what we’re understanding is exactly what Dr. Martin Luther King has said before: Injustice anywhere is a threat to justice everywhere,” he added.

Mahdawi’s case was a unique outlier against a backdrop of rushed and unconstitutional deportations that have shipped immigrants to ICE centers far from their homes. Unlike others, Mahdawi was allowed to remain in Vermont, where he lives and attends school remotely.

Mahdawi co-founded Columbia University’s Palestinian Student Union alongside detained peer Mahmoud Khalil, another legal U.S. permanent resident who was shipped to an ICE center in Louisiana in March, shortly after he was ripped away from his pregnant wife by plainclothes ICE agents. An immigration judge ruled April 11 that Khalil could be deported out of the country, but he has remained in the U.S. as he appeals the decision. The 30-year-old got a break in the case earlier Wednesday when another federal judge ruled that Khalil could argue in court that he was targeted for deportation due to his political views.

The Trump administration has leaned on the Alien Enemies Act of 1798 to justify their immigration crackdown while ignoring immigrants’ due process rights, sometimes defying court orders in the process.*

Donald Trump has justified the infractions by claiming that immigration into the country is tantamount to an “invasion,” and has described the current era as a “time of war.”

Arguing in a Department of Homeland Security notice justifying Mahdawi’s detention, State Secretary Marco Rubio wrote that Mahdawi’s continued “presence” in the U.S. could create “adverse foreign policy consequences.” In other petitions to boot immigrants out of the country, Rubio has effectively likened free speech to a crime, arguing that protests of U.S. involvement in the war in Gaza should be construed as deportable offenses.

Mahdawi grew up in a Palestinian refugee camp in the West Bank, where most of his family remains. He has been outspoken about his experiences growing up in the occupied region, describing the murders of his friends and loved ones by Israeli forces, and the violence he experienced when he was shot in the leg by an Israeli soldier at the age of 15.

“Before coming to this country, freedom was just a concept,” Mahdawi told NPR on Tuesday. “But the actual experience of freedom of movement to travel among 50 states, freedom to breathe the breeze of the ocean, and to feel your toes in the sand. This is the first place I have experienced this freedom of speech where I will not be actually retaliated against or punished for saying my mind.”

“Do I still feel this way?” he continued. “I think it’s in jeopardy. I think this is a red flag, not only to me, but to the American people who care about freedom, the right to life, liberty and the pursuit of happiness. I have the hope that this country will fulfill its promise.”

* This story has been updated, and the origin of the Alien Enemies Act has been corrected.

Donald Trump’s economy has not been doing well, but you’d never think that if you got your news from the president.

On Wednesday, Trump once again blamed the market’s poor performance on the last guy in office, claiming on Truth Social that the country was still suffering under “Biden’s Stock Market.”

“I didn’t take over until January 20th,” Trump wrote. “Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers. Our Country will boom, but we have to get rid of the Biden ‘Overhang.’ This will take a while, has NOTHING TO DO WITH TARIFFS, only that he left us with bad numbers, but when the boom begins, it will be like no other. BE PATIENT!!!”

Regardless of your opinion on his presidency, Joe Biden’s economy was fruitful by a number of metrics. His tenure in the White House saw historic job gains, curated business development, and decreased unemployment. Biden’s stability in office also aided the market’s steady growth, helping it repeatedly defy negative forecasts and grow gross domestic product by 12.6 percent, which the last administration celebrated as a “historically robust expansion.”

Further still, some economists believe Trump wouldn’t have seen a second term in office if it wasn’t for Biden’s market success. In the days immediately following the presidential election, the University of Chicago School of Business’s Booth Review pitched an economic theory that Trump’s win was, in large part, due to Biden’s strong economy, arguing that Americans are more likely to take risks at the voter booth with low-tax candidates when the economy is strong. (Conversely, the Booth Review argued that Americans historically vote for Democrats during periods of economic instability, such as the Great Depression, which saw the rise of President Franklin D. Roosevelt, and the Great Recession, which sparked Barack Obama’s presidency.)

And unfortunately for Trump, his numbers are bad. A 100-day report on Trump’s economy found that GDP in the first quarter decreased by 0.3 percent, a startling drop from 2024’s fourth quarter, which saw GDP increase by 2.4 percent.

“Compared to the fourth quarter, the downturn in real GDP in the first quarter reflected an upturn in imports, a deceleration in consumer spending, and a downturn in government spending that were partly offset by upturns in investment and exports,” the U.S. Bureau of Economic Analysis reported Wednesday.

And it’s not the only negative measure of Trump’s performance. A report released Tuesday by the Conference Board found that the consumer confidence index fell by 7.9 points in April, bringing overall consumer confidence to 86 and closer toward the 80-point threshold that “usually signals a recession ahead.”

The number of consumers expecting fewer jobs in the next six months (32.1 percent) was also alarming, reaching heights not seen since April 2009, when the country was in the midst of the Great Recession.

The root cause of the instability was “high financial market volatility in April” that hit American consumers’ stock portfolios and retirement savings hard and fast, per the Conference Board’s report. That was almost singularly due to Trump’s machinations in the White House, which included releasing (and stalling) a sweeping and vindictive tariff proposal plan that economists observed (and the White House eventually confirmed) was founded on bad math.

Elon Musk has departed from the White House as he prepares to end his tenure as the department’s leader, according to reporting from the New York Post.

“Instead of meeting with him in person, I’m talking to him on the phone, but it’s the same net effect,” maintained White House chief of staff Susie Wiles, who later noted that the billionaire “hasn’t been here physically, but it really doesn’t matter much.” Musk is said to be officially stepping down sometime in May.

While Musk is leaving DOGE headquarters, which is just a short walk from the Oval Office, DOGE and all of the staffers he appointed will remain.

“The people that are doing this work are here doing good things and paying attention to the details. He’ll be stepping back a little, but he’s certainly not abandoning it,” Wiles said. “And his people are definitely not.”

Musk’s departure sounds great to a majority of Americans (and Tesla shareholders), but reports of a clean break between Trump and Musk—one of the defining characters of the second-term MAGAverse—are greatly exaggerated. Musk is keeping one foot in and one foot out, offering competing images of what his role will be in the future.

“I’ll have to continue doing [DOGE] for, I think, probably the remainder of the president’s term, just to make sure that the waste and fraud that we stop does not come roaring back, which [it] will do if it has the chance,” Musk said on a Tesla call, contradicting his comments about stepping away. “I think I’ll continue to spend a day or two per week on government matters for as long as the president would like me to do so and as long as it is useful.”

A day or two per week on government matters. This guy isn’t going anywhere. As The New Republic’s Alex Shephard wrote, it’s much more likely that Musk realizes that his public relationship with Trump (who is currently at his most unpopular) is toxic for the value of his multiple businesses. Musk is only changing his public relationship with Trump and DOGE, while fully maintaining it in private.

Donald Trump isn’t giving a clear answer regarding Secretary of Defense Pete Hegseth’s future.

On Tuesday, Trump sat for an interview with ABC News’s Terry Moran, who asked the president if he had “100 percent confidence in Pete Hegseth.”

Trump’s reply didn’t exactly inspire confidence.

“I don’t have 100 percent confidence in anything. OK? Anything. Do I have 100 percent; it’s a stupid question. Look—” Trump said, before Moran interjected.

“It’s a pretty important position,” said Moran.

“I have—no, no no. You don’t have 100 percent. Only a liar would say ‘I have 100 percent confidence.’ I don’t have 100 percent confidence that we’re gonna finish this interview,” Trump said.

While the interview did continue, Hegseth would have probably preferred a stronger show of support from his boss at that moment. The former Fox News host has been under fire for the past several weeks over his use of private chats on the Signal app to discuss attack plans on Houthi rebel targets in Yemen, as well as his manic efforts to find leakers at the Department of Defense.

The “Signalgate” scandal has dogged Hegseth as worse revelations have come out every day, from the fact that journalist Jeffrey Goldberg was present in one of the group chats to the fact that a second chat contained Hegseth’s brother and wife. Hegseth has refused to resign and still has the support of the president for the time being. The question is whether Trump will eventually get fed up with the negative coverage, or if there’s a new worse revelation about Hegseth on the horizon.