In a recent appearance on CBS's "Face the Nation," Gary Cohn, former director of the National Economic Council under President Trump and current vice chairman of IBM, offered a nuanced assessment of the U.S. economy that challenged the administration's rosy narrative. While acknowledging strong macroeconomic indicators, Cohn highlighted a growing disconnect between top-line growth and the financial realities facing everyday Americans.
The interview, conducted by Margaret Brennan on February 1, 2026, came on the heels of a Wall Street Journal editorial by President Trump claiming credit for current economic success through his tariff policies. These same policies are currently under scrutiny by the Supreme Court, raising questions about both their legality and effectiveness.
**Macroeconomic Strength Meets Microeconomic Pain**
Cohn began by acknowledging the undeniable strength of key economic indicators. "The economy is quite strong right now on top-line growth," he stated, pointing to a robust gross domestic product (GDP) growth rate trending around 5%. This figure significantly exceeds the baseline growth experienced over the previous decade, representing a notable acceleration in economic output.
The inflation picture has also improved, with rates falling to the high 2% range, though Cohn noted this remains above ideal levels. Unemployment, while ticking upward, still hovers around 4% to 4.5%—a historically reasonable rate by most standards.
However, Cohn quickly pivoted to a more critical perspective, describing what he characterized as a "dual economy." While wealth accumulates at the top, he explained, hardworking Americans are struggling to pay their bills and experiencing genuine economic hardship. This assessment directly contradicts the administration's optimistic messaging and suggests a more complex reality beneath the surface-level data.
The former economic advisor suggested that the president's op-ed was strategically timed to address this very disconnect. "I think part of the reason the president wrote the op-ed was to try and get out in front of people who are having a hard time paying their bills and meeting their expenses," Cohn explained. "The White House is going on the offensive. The president is going to spend time out on the road talking about affordability."
**The Affordability Challenge as Political Flashpoint**
Cohn predicted that affordability will dominate the political conversation leading up to the midterm elections. This forecast aligns with the White House's stated strategy, as Chief of Staff has reportedly urged the president to focus on economic messaging. However, the administration's approach has faced skepticism, with some officials suggesting that Americans will simply "feel better after tax time."
This perspective seems increasingly disconnected from recent corporate developments. Despite the positive macroeconomic narrative, major companies have announced significant workforce reductions. Amazon revealed plans to cut 16,000 corporate positions, while MasterCard announced a 4% reduction across its 35,000-person workforce. Shipping giant UPS eliminated 30,000 jobs, Dow Chemical cut 4,500 positions, and Home Depot reduced its workforce by 800 employees.
These layoffs, totaling over 60,000 additional job losses according to Cohn's account, paint a starkly different picture from the unemployment statistics alone. They reveal structural shifts and cost-cutting measures that suggest corporate America is bracing for challenges not reflected in headline economic numbers.
**Tariff Policies Under Legal and Economic Scrutiny**
The president's editorial attributed economic success to tariff policies currently being debated before the Supreme Court. Cohn, who served as Trump's top economic advisor during the first term, offered a measured assessment of these claims.
While not directly disputing the growth figures, his emphasis on the struggles of average Americans implies skepticism about the distributional effects of tariff policy. Tariffs typically increase costs for consumers and businesses, potentially exacerbating affordability issues even as they may protect certain domestic industries.
The Supreme Court's consideration of the tariffs' legality adds another layer of uncertainty. A ruling against the administration could force a rapid policy reversal, with implications for trade relationships and economic stability. Conversely, upholding the tariffs would validate a key tool in the administration's economic arsenal but might do little to address the affordability concerns Cohn highlighted.
**The Wealth Effect vs. Wage Reality**
Cohn's reference to a "massive wealth effect at the top end" points to a critical economic dynamic. Asset values—particularly in equities and real estate—have likely appreciated significantly, benefiting those who hold such assets. This creates positive spending patterns among wealthier households, contributing to GDP growth.
However, this wealth effect hasn't translated to wage growth for middle and lower-income workers at a pace sufficient to offset inflation's impact on essential expenses. Housing costs, food prices, healthcare, and energy remain elevated, squeezing household budgets despite nominal wage increases.
The result is a disconnect between statistical economic health and lived economic experience. While GDP growth suggests a booming economy, consumer sentiment often reflects personal financial strain, particularly for those without significant asset holdings.
**Corporate Restructuring Signals Underlying Weakness**
The wave of corporate layoffs Cohn referenced deserves closer examination. These aren't isolated incidents but rather a pattern across diverse sectors: technology (Amazon), financial services (MasterCard), logistics (UPS), manufacturing (Dow), and retail (Home Depot).
Such widespread cost-cutting suggests companies are preparing for:
- Reduced consumer demand
- Margin pressure from ongoing cost inflation
- The need to invest in automation and efficiency
- Uncertainty about future economic policy
These layoffs primarily affect corporate and administrative roles, indicating efforts to streamline operations and reduce overhead. While this may improve corporate profitability, it simultaneously reduces employment security for white-collar workers and contributes to the economic anxiety Cohn described.
**Political Implications and the Path Forward**
Cohn's prediction that affordability will be the central election issue reflects a broader political reality. Voters tend to evaluate the economy based on personal circumstances rather than abstract statistics. The administration's challenge is bridging the gap between impressive macroeconomic data and the daily financial pressures Americans face.
The president's planned road tour to discuss affordability suggests recognition of this challenge. However, effective solutions require more than messaging. Policy options might include:
- Targeted tax relief for middle and lower-income families
- Measures to reduce housing costs
- Investments in affordable healthcare and education
- Wage growth initiatives
Without concrete action, the administration risks appearing out of touch, regardless of GDP growth figures. Cohn's candid assessment, coming from a former insider, lends credibility to concerns about the economy's uneven recovery and the political vulnerability it creates.
**Conclusion: A Complex Economic Reality**
Gary Cohn's interview reveals an economy at a crossroads. The macroeconomic indicators—GDP growth, controlled inflation, low unemployment—suggest robust health. Yet the microeconomic evidence—widespread layoffs, affordability struggles, and a growing wealth gap—paints a more troubling picture.
As the Supreme Court weighs the legality of tariff policies and the administration prepares its affordability messaging campaign, the fundamental challenge remains: ensuring economic growth translates to financial security for all Americans, not just those at the top. The outcome of this debate will likely shape not only the midterm elections but the nation's economic trajectory for years to come.