'We are in real trouble:' How Trump's tariff policies could drive a recession

On Wednesday, the Bureau of Economic Analysis reported U.S. gross domestic product declined by 0.3% in the first quarter of 2025. This marks the first contraction of the U.S. economy during a quarter since the first quarter of 2022. Scripps News speaks with Lindsay Owens, executive director of the Groundwork Collaborative, about what the shift, driven by Trump's tariff policies, could mean for consumers. "My reaction to today's news is that we are in real trouble. The economy has deteriorated considerably since Trump took office," Owens said. "I think the pain that we could be looking at for American families could be quite considerable. When we think about recessions, the effects are long-lasting. There are real scarring effects that stick with families and individuals for generations. People who lose their jobs or graduate during recessions may never recover the same level of earnings as folks who graduated just prior or hold on to their jobs. So it's a really troubling sign for what's to come." And there is concern that the tariff policies could drive not just a recession, but higher inflation at the same time. "If you think a recession is bad, get ready for stagflation," Owens said. "This is when you get all of that slowing growth and that slowing demand that you see during a recessionary period. But you don't get any of the cooling prices that often accompany a recession. You would instead see continued high sticky inflation. Your wages will not be keeping up with the pace of prices, and you won't get any relief in the pocketbook. So stagflation is very concerning for the economy, but also for American consumers." ------------------------------------- Join our newsletter at https://bit.ly/2q1tepr Follow us on Facebook: https://www.facebook.com/scrippsnews/ Follow us on Twitter: https://www.twitter.com/scrippsnews Follow us on Instagram: https://www.instagram.com/scrippsnews/ Follow us on TikTok: https://www.tiktok.com/@scrippsnews