McDonald’s Price Cuts Won’t Offset Tariff-Driven Inflation
So here’s the latest: McDonald’s has announced it’s cutting the prices of some of its combo meals. Now, that might sound like good news, especially for anyone who’s been feeling the pinch of rising costs lately. The fast-food chain is clearly trying to show that it understands Americans are struggling and wants to restore its reputation for affordability, which has taken a hit as people tighten their wallets. Restaurants, particularly fast-food chains, have been having a hard time attracting customers who are worn down by inflation and uncertain about the economy.
But here’s the catch: McDonald’s price cuts are only a small relief in a bigger picture where prices across the board are going up. Other major companies are continuing to raise prices, and much of this is being linked to tariffs implemented under President Donald Trump. For instance, Sony recently raised the price of its PlayStation 5 by $50 in the U.S., even though video game consoles usually become cheaper a few years after release. Microsoft and Nintendo have done the same with their gaming systems and accessories. Home Depot, Procter & Gamble, and Walmart have all announced price increases as well, citing tariffs as a driving factor.
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And it’s not just the big corporations. Small businesses, which don’t have as much flexibility, are raising prices too. They’re finding ways to pass costs onto consumers, sometimes in less obvious ways like cutting free shipping or adding service fees. As Federal Reserve Chair Jerome Powell pointed out, some companies are taking advantage of the situation to increase prices even when they aren’t directly affected by tariffs—much like we saw during the pandemic.
Meanwhile, other living costs are climbing at a worrying rate. Electricity is rising at twice the rate of inflation, housing remains out of reach for millions, and overall, Americans are feeling the squeeze. Trump’s promises to bring down prices during his campaign haven’t materialized, and voters are taking note. Inflation is now a major issue where his approval has declined sharply.
Democrats are trying to seize on this frustration. Candidates like Abigail Spanberger in Virginia and Zohran Mamdani in New York City have run on platforms promising to lower the cost of living. But experts warn that reversing tariffs alone won’t solve the problem. The economy is increasingly “K-shaped,” meaning the wealthy are spending more while the rest struggle to keep up. Companies are targeting higher-income consumers, who now account for about half of all consumer spending, rather than lowering prices for the broader population.
In short, while McDonald’s price cuts might offer a small moment of relief, the larger forces of inflation and tariff-driven price increases mean Americans are still feeling the pinch. For political leaders, the challenge is urgent: voters want solutions that can make a real difference in their wallets—and soon.
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