The richest 10% of Americans currently account for a record share of total consumer spending (49%). This percentage has risen by 13 percentage points over the last 30 years. At the same time, the 80% of people with the lowest incomes account for only about 37% of total consumer spending. This is a decline of 11 percentage points since 1995.
It is extremely important because consumer spending accounts for 68% of US GDP. This means that the richest 10% account for a record 33% of GDP. Meanwhile, the poorest 80% of Americans account for only 25% of the US economy. These figures show that the US economy has become dependent on the spending of the richest. When 10% of the population generates 1/3 of GDP, it is no longer just a question of inequality — it is a question of the imbalance of the system.
This very pessimistic sentiment among consumers in the United States is the result of a declining sense of security. When consumers are uncertain about their future, they spend less. Consumer sentiment is currently at the same level as during the pandemic in 2020, a time of economic downturn, because Americans fear the consequences of the tariffs imposed by the Trump administration. To reverse this view, Trump announced the introduction of “dividends” from tariff revenues. This dividend would amount to at least $2,000 for every taxpayer, with the exception of high-income individuals. However, apart from the announcements, there are still no official regulations or an official programme to implement this initiative. Such low morale among the American middle and lower classes is also due to the fact that almost one in four Americans has no savings.
Incidentally, with raw materials becoming more expensive, especially metals, the social transfers announced by Trump are adding fuel to the fire of inflation. And Trump is doing everything he can to stimulate it, devalue the dollar and appoint to the Fed his man from May onwards (when Jerome Powell’s term ends), who will certainly lower interest rates on the President’s orders to accelerate the whole process.
