Democrats’ fearmongering about the Trump economy is looking more and more like sour grapes.
Yesterday’s CPI report, showing inflation at 2.7 percent — well below the expected 3.1 percent — was bad political news for Democrats. Since April’s “Deliverance Day,” when President Trump introduced tariffs designed to reset global trade in favor of American companies, the left and their media allies have warned voters that the White House’s actions will shake our economy and cause inflation to soar.
It didn’t happen. Tariffs increased prices only modestly. Instead, Trump’s agenda of higher energy production, smaller budget deficits and lighter regulations has reduced inflation. While inflation averaged 5 percent annually under former President Joe Biden and rose nearly 22 percent in four years, as of November it is rising to 2.7 percent.
Remind me again who created the “affordability crisis?”
As inflation continues to retreat from the high of 9 percent under Biden, voters may realize just how much damage has been done by Joe’s budget-busting big government spending.
Another narrative that is being discussed is that Trump-backed artificial intelligence is a gift to billionaires but will destroy US jobs, just like the trade pacts of the 1990s that sent jobs overseas. But two new studies contradict that claim. As it turns out, AI is actually creating jobs for Americans.
In its year-end note to investors, investment firm Vanguard writes that AI is not responsible for slowing job growth. They point to data showing that “the 100 or so occupations most exposed to AI automation are actually outperforming the rest of the labor market in terms of job growth and real wage growth.”
The accompanying charts show that employment in occupations affected by AI grew by 1.7% during the two years from mid-2023 to mid-2025, compared to just 1.0% before COVID and 0.8% for other types of jobs. Similarly, real wage growth for AI jobs is advancing 3.8 percent, compared to 0.7 percent for other occupations.
The authors of the study suggest that “current AI systems generally improve worker productivity and shift workers’ tasks to higher-value activities.”
Strategy consultancy Teneo’s latest CEO and investor outlook survey backs Vanguard’s assessment. They write, “most CEOs and investors [are] we expect AI to drive employment growth at all levels in 2026.” The survey shows that more than two-thirds of CEOs expect AI to drive increased hiring of both entry-level and mid-career candidates; most see an increase in senior management hiring. Interestingly, investors are even more optimistic that AI will boost employment.
These projections are reassuring because the left has been making dire predictions about the rapid growth of AI. To quote Bernie Sanders, “there is a very real fear that, in the not-so-distant future, a super-intelligent artificial intelligence could replace humans in control of the planet.”
In addition to predicting the demise of human authority, the Vermont senator also published an op-ed on Fox News citing a report suggesting that “AI, automation and robotics could replace nearly 100 million jobs in America over the next decade, including 40 percent of nurses, 47 percent of truck drivers, 64 percent of accountants, 65 percent of fast food workers, and 65 percent of fast food workers.” food, 65% of other professionals.” Sanders is so unhappy with artificial intelligence that he’s calling for a moratorium on the construction of new AI data centers to “give democracy a chance to catch up.”
Even assuming there is some truth to Bernie’s alarmism, if the US slows its AI push, China will overtake us. Do we really want China to dominate the manufacturing of the future? No – letting China take the lead would be dangerous indeed.
Bernie’s concern about AI’s impact on employment is probably real. But many of his fellow Democrats are blasting the AI spending boom as they recognize that the fast-growing industry is becoming a tailwind for the Trump economy. They know that the interim period will depend on jobs and growth, and that the huge amount of money that will flow into building data centers, our power grid, new power plants and other related activities is likely to drive solid growth in 2026.
This is one of the reasons why blue states have tried to stifle AI development with regulation. Trump recently issued an executive order to prevent Democratic officials from creating regulatory roadblocks to AI development. There were approximately 1,000 bills making their way through state legislatures; given the opportunity, those new and sometimes contradictory laws would have stopped AI growth in its tracks.
If the economy hums along next year, with real wages rising, inflation moderating and productivity rising — which is likely — Republicans may well retain control of the House. That would give Trump two more years to work on resetting global trade, reforming our fraudulent welfare programs, improving our broken immigration system, and possibly moving on to other ambitions, such as upholding voter integrity.
The left cannot tolerate this prospect. So in addition to fighting the president at every turn, slowing his appointments, challenging every executive order in the courts, and most recently extending the longest government shutdown in our history, they’ve been constantly raising alarm bells about the economy. From the beginning, they warned Americans about Trump’s tariffs; now the focus is on AI, which not only fuels investment in our country, but also the stock market.
They fear that rising stock values (a bubble!) could spur spending, which in turn fuels growth and employment.
The Democrats’ campaign against AI has been effective. David Sachs, the White House’s AI czar, says China leads the US in one area: optimism. He points out that 83 percent of Chinese are optimistic about artificial intelligence, compared to just 39 percent of Americans. How sad is that?
Hopefully, as AI leads to critical medical breakthroughs and helps increase productivity and growth, voters will see the new technology as an agent of progress and encourage its development. Maybe even Bernie Sanders will get on board.
Liz Peek is a former partner at Wertheim and Company on Wall Street.
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