PROMISES TRUMP HAS KEPT, OR NOT KEPT, FROM HIS 2025 JOINT SESSION OF CONGRESS SPEECH

The speech also comes in a politically critical year for Republicans and the Trump administration. The midterm elections are fast approaching and Democrats are hoping to wrest back control of the House and Senate in large part by latching onto voter discontent about the economy.

This will be an opportunity for the president to discuss his economic policy agenda ahead of the elections and explain how Republicans intend to help working- and middle-class voters. Trump is suffering from low economic approval ratings, which could possibly hurt Republicans in November and hamstring the president’s agenda.

Jobs and growth

The labor market has remained above water since Trump entered office but has not expanded as much as in more recent years. Job growth has slowed over the past year, although it did pick up in January, with 130,000 jobs added, and the unemployment rate ticked down one-tenth of a percentage point to 4.3%.

Still, there was a revision to the past year’s data showing that payroll employment was 1 million lower at the end of 2025 than previously thought.

Taken together, with the revisions in mind, the economy has added nearly 360,000 jobs since January 2025, when Trump entered office. That is positive growth, but not as much job creation as was seen in the years prior. In the comparable period in the first year of Trump’s first term, for example, the economy added more than 2 million jobs.

Economic growth is one of the strongest spots in the economy, and one that Trump will likely laud during his State of the Union address.

“GDP has been good — it was great in the third quarter, a little less so in the fourth quarter, I’d expect them to play up those numbers, because even though growth is slower than it was in 2024 it’s still holding steady,” Ryan Young, senior economist at the Competitive Enterprise Institute, told the Washington Examiner.

Overall, the economy grew 2.2% in 2025. Trump officials had been touting the prospects for a much stronger number before the publication of a surprisingly weak fourth-quarter GDP report that saw the economy expanding at only a 1.4% clip, down significantly from the previous two quarters.

Economic growth dropped by 0.5% in the first quarter of 2025, rose 3.8% in the second, and increased by a strong 4.4% in the third quarter.

Inflation

Inflation is perhaps the thorniest economic problem for Trump and Republicans.

When Trump entered office in January 2025, inflation, as measured by the consumer price index, was running at about 3%. That is a full percentage point above the Fed’s long-term goal of 2% stable price growth.

At the State of the Union, Trump will likely talk about how CPI inflation has fallen to 2.4% over the past year. Core inflation, a measure that strips out volatile food and energy prices, fell one-tenth of a percentage point to 2.5% for the year ending in January. That is the lowest core inflation since March 2021.

While that is still above what the Fed considers healthy, it is downward progress. Many economists will also note that the decline comes even after many thought Trump’s tariffs could push inflation higher.

Still, other measures of inflation haven’t been trending in the right direction.

The Fed’s preferred inflation gauge, the personal consumption expenditures index, has ticked up two months in a row now and was running at 2.9% in December, the most recent data available.

Mark Hamrick, senior economic analyst at Bankrate, told the Washington Examiner that the White House has focused on individual goods and services prices that have fallen but have deemphasized areas where inflation is still trending up.

“We can all cherry-pick categories within the consumer price index and see where prices have fallen — eggs are a primary example, gasoline is another example, which is obviously quite volatile,” Hamrick said.

In the past year, the price of fresh whole chicken has fallen 1.3%. Egg prices, which were high last January thanks to an outbreak of the avian flu, are down more than 30%. And cheese prices have fallen 1.2% since this time last year. Some fruit and vegetable prices, such as those for potatoes and tomatoes, have also posted declines.

Still, ground beef prices increased by more than 17%. Uncooked beef roasts are up 15% and steaks cost nearly 13% more.

Coffee prices have also ballooned 18.3% over the past year.

Electricity prices have been difficult for households, as demand on the grid has soared. Electricity prices have gone up 6.3% in the past year. Households are saving on fuel, though, as prices for gasoline are down 7.5% for the year.

Federal Reserve

Trump might also use the opportunity to attack the Federal Reserve and Fed Chairman Jerome Powell, who have been frequent (and controversial) targets of his over the past year.

Trump has been pushing the central bank to lower interest rates. The Fed did reduce its interest rate target three times last year, but the administration has argued that it is not slashing rates enough.

Former Fed Gov. Kevin Warsh has been nominated by Trump to succeed Powell as the central bank’s top official, and the president might take the opportunity to talk about Warsh and why he was chosen.

Another question is whether the president will bring up the investigation into Powell. In January, Powell announced that the Justice Department was investigating him, and he said the central bank recently received grand jury subpoenas related to testimony he gave to the Senate last year about renovation cost overruns at the Fed headquarters building in Washington.

Powell said the inquiry was simply a pretext to pressure him on monetary policy. The extraordinary accusation sparked some concern even from some congressional Republicans.

Tariffs and investment

The annual address before Congress also comes just days after the Supreme Court, which has a conservative majority, struck down Trump’s most sweeping tariffs.

Trump decried the ruling and has criticized the high court for the action. Supreme Court justices usually attend the State of the Union, so the speech could afford an opportunity for him to address them directly in such a high-profile venue.

“I also expect him to attack the Supreme Court, just as he already has in print, and in words,” Young said, adding that he was surprised the court decided to release its opinion on Friday, given the dynamics surrounding the coming address.

On Friday after the announcement, Trump added a 10% global tariff under Section 122 of the 1974 Trade Act, a levy he later increased to 15% over the weekend.

Trump will likely use the speech to defend his tariffs even after a majority of the GOP-controlled House voted to end the national emergency Trump declared on Canada last year, with six Republicans joining nearly all Democrats in favor of the rebuke.

Trump could argue that the tariffs were a significant source of revenue for the federal government that is now being threatened. For instance, the Congressional Budget Office found in August that Trump’s tariff agenda, if maintained, would decrease total deficits by up to $4 trillion over the next decade.

Trump might also boast about the level of investment he has been able to secure. He has claimed that at least $18 trillion in investment has come from companies and foreign governments, although many have pushed back on that assertion.
 
Notably, while Trump has mentioned $18 trillion in investments and even $21 trillion in investments, it isn’t clear where that number is coming from, and the White House tracker for investments pegs total United States and foreign investments at $9.7 trillion.
 
Among the investments listed on the site include $1.2 trillion from Qatar, $1 trillion from Japan, and $1.4 trillion from the United Arab Emirates. But looking under the hood, that $1.4 trillion from the UAE would represent more than double the country’s own gross domestic product.
 
Also, the $1.2 trillion Qatar investment isn’t Qatar investing in the U.S. itself, but rather generating $1.2 trillion in “economic exchange” between the two countries.
 
Additionally, the White House website lists a $600 billion investment from “EU firms,” although that figure appears to be a projection, rather than an actual monetary commitment, according to previous reporting from the Washington Examiner.

Young said that the $18 trillion figure is “almost entirely fluff.”

“For one thing, we never heard $18 trillion over how many years,” Young said. “Because $18 trillion is more than half of the entire U.S. GDP. If we had that much investment coming in, there would be massive changes in the market.”

During his speech, Trump might also note how some economists misjudged how the tariffs would affect economic growth, given the surprisingly high GDP growth last year.

“The economy has managed to avoid a significant downturn despite the prevalence of these historically high tariffs,” Hamrick said.

Housing

The House and Senate have made lowering housing costs and helping with housing affordability a priority during this session of Congress. Both chambers have seen the advancement of bipartisan housing bills designed to help with supply.

Trump has spoken a lot about lowering interest rates in an effort to concurrently drive down mortgage rates, which have been high for some time and are one of the big barriers to home ownership.

But at the same time, it’s been unclear whether Trump supports the underlying House and Senate bills, after he said he doesn’t want to see people’s home prices fall.

Young voters in particular have been affected by the housing affordability crisis. The National Association of Realtors recently said that the median age of a first-time homebuyer has now risen to 40.

One thing Trump might mention in his speech is his push to ban large institutional investors such as Blackstone from buying up single-family homes.

Last week, the White House began circulating draft legislative language to ban institutional investors, those who own more than 100 homes, from buying single-family homes to rent out. The White House wants the measure included in any bipartisan housing bill, and Trump could use the opportunity to implore lawmakers in the audience to do so.

Tax cuts

Finally, Trump will undoubtedly use the State of the Union to draw attention to the biggest legislative achievement of his second term — the One Big Beautiful Bill Act, which Republicans have recently worked to rebrand as the working families tax cut plan.

The bill contained a number of provisions, and most taxpayers would have seen a tax hike if Republicans didn’t get it over the finish line. The biggest portion of the act merely makes permanent the current individual tax rates. Those rates were reduced as part of the 2017 Tax Cuts and Jobs Act, which passed during Trump’s first term.

The bill also contained other campaign-era promises from Trump, such as no tax on tips and no taxes on overtime pay, which Republicans hope to emphasize in the run-up to the midterm election.

‘A BIG MESS’: MAJOR UNCERTAINTY OVER WHETHER TRUMP HAS TO REFUND TARIFFS

Trump and Treasury Secretary Scott Bessent have also frequently noted how many people will see a bigger tax refund this year as a result of the law. Bessent recently said that the average tax refund will be 22% higher this year.

Trump will likely walk through some of the key provisions of the bill as the administration and Republicans work to highlight how the bill affects working- and middle-class families, despite attacks from Democrats that it benefits the wealthy.