Sticky inflation and rising unemployment have raised concerns that stagflation could return.
And that could be a problem for President Donald Trump, who regained the White House in the 2024 election on a platform of lower prices and broad prosperity.
“It’s the worst of both worlds where you have higher prices and lower growth,” said Jai Kedia, a research fellow at the Cato Institute’s Center for Monetary and Financial Alternatives.
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For some, stagflation brings back memories of the 1970s — a decade of long gas lines and paychecks that couldn’t keep up with grocery bills.
Heavy federal spending from the Great Society and the Vietnam War contributed to rising prices.
Former President Richard Nixon imposed wage and price controls in 1971 to stabilize a slowing economy.
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