Nobel Prize-winning economist Paul Krugman delivered a stark warning for President Donald Trump and the Republican Party as the midterm elections approach. He highlighted mounting economic challenges that could spell trouble for the administration’s re-election efforts.

In a recent post on his Substack, Krugman characterized the current economic atmosphere as “really, really bad news” for the Trump administration. He pointed to a troubling combination of negative economic sentiment, a declining job market, and soaring borrowing costs, all of which stand in stark contrast to the narrative being pushed by the White House.

Krugman’s insights were backed by findings from a new AP-NORC poll, revealing that a staggering 74 percent of American adults view the national economy as poor. Only 26 percent described it as good, illustrating a disconnect between the administration’s optimistic portrayal of the economy and the everyday realities faced by voters.

The same poll brought grim news for President Trump regarding his approval ratings on economic issues, with only 26 percent of respondents approving of his handling of the economy. Disapproval rates stood at a concerning 73 percent, a significant blow for a president who campaigned largely on promises of economic prosperity.

Moreover, Trump’s handling of the rising cost of living was met with even more skepticism, as just 17 percent of those surveyed expressed approval, while 82 percent disapproved. This survey, conducted between September 24-28 among 2,140 adults, reflects a margin of error of plus or minus 2.9 percentage points.

Krugman noted a marked shift in American sentiment towards local versus national economic conditions. While Americans tended to feel more optimistic about their local economies during President Joe Biden’s first year, the latest data indicates a decline in confidence even in local economies.

According to the September AP-NORC survey, 61 percent of participants said the national economy had worsened since Trump’s inauguration, while only 23 percent believed it had improved. When asked about their local economies, 55 percent perceived them as worse, compared to just 20 percent who saw improvement.

Compounding these issues is a faltering labor market. While official employment measures remain relatively strong compared to historical standards, the perception of job availability has rapidly declined. The Conference Board reported a decrease in consumer confidence, with the number of individuals stating that jobs are plentiful dropping to 23.6 percent in September, down from 24.5 percent in August.

At the same time, the proportion of consumers asserting that jobs are hard to find rose to 21.9 percent, indicating a deteriorating outlook on employment opportunities. This marks the third consecutive month of declining consumer confidence, raising alarms about the public’s economic mood.

Housing market complications further exacerbate the situation, with mortgage rates elevating to an average of 7.28 percent for 30-year fixed loans—its highest level since November 2023. This spike marks the largest weekly increase in four years and adds another layer of financial stress for many American families.

Throughout his analysis, Krugman stressed the troubling economic environment contradicts the administration’s claims of ushering in a “Golden Age” for the nation. He challenges the White House’s value proposition: “Who are you gonna believe, me or your own eyes?” in terms of economic conditions.

With the midterm elections just weeks away, Krugman underscored that economic factors are equally as critical as political polling. He asserts that while some economic indicators may appear robust, everyday experiences and perceptions about prices, housing, and jobs are moving in a decidedly negative direction.

The disconnect between the administration’s rhetoric and reality will likely intensify as voters prepare to go to the polls. Krugman’s commentary resonates strongly against the backdrop of an increasingly anxious electorate.

This complex intertwining of economic sentiment and political reality could heavily influence not just the midterms but Trump’s broader prospects for the 2024 election cycle.

As candidates rally their bases and reshape their messages in light of these warnings, the economic landscape will remain a pivotal battleground. Voters could soon cast their ballots based on what they see in their own wallets, rather than the optimism emitted from Washington.

With uncertain economic conditions reigning, the next month could prove critical. How both parties adapt their strategies in light of these warnings will be closely watched as America moves toward the midterm elections.