☕️ Some of you have noted that yesterday's newsletter was a touch gloomy. You may want to sit down for today's.

• We take a look at the economy's new Great Disruption, plus the chaos for DOGE'd federal workers seeking benefits, and the end of the phrase "soft landing."

All in 1,040 words, a 4-minute read.

Five years after the coronavirus pandemic turned the world on its head, Donald Trump is doing the same thing.

Why it matters: This time, it's on purpose.

The big picture: The lives of thousands — possibly millions — are at stake.

• There's a massive geostrategic reconfiguration, an unprecedented flood of government spending (albeit in Germany) and, underneath it all, the hope and possibility that by burning everything down, something better will be able to grow in its place.

What they're saying: House Speaker Mike Johnson used a billiards analogy in a press conference yesterday to explain that President Trump's strategy is a bit like the break at the beginning of the game.

• "You hit it as hard as you can," he said, adding that "is what's required to start the process of repairing and restoring the American economy."

Flashback: A "shake up," to use Johnson's term, is what the pandemic provided.

• My book, "The Phoenix Economy," tells the story of how the death and disruption of the pandemic created a more uncertain and volatile world, with both bigger downsides and bigger upsides.
• For Trump supporters, it didn't go far enough.

Where it stands: It's an article of faith among the two wings of the MAGA party — the Bannonites and the Muskites — that America, under successive Democratic and Republic regimes, has become sclerotic, complacent and overly risk-averse.

• They point to spiraling entitlements, especially in Medicaid, increased corporate concentration, especially in Big Tech, and, above all, an out-of-control national debt.
• "Most federal spending is entitlements, so that's like the big one to eliminate," Elon Musk said in an interview with Larry Kudlow on Monday, noting the savings could be between $500 billion and $700 billion per year, orders of magnitude greater than anything DOGE has found until now.

Zoom out: The big idea is that painful cutbacks in the short term create the preconditions necessary for newly invigorated growth over the long term.

• One lesson of the pandemic was that politicians rarely (if ever) suffered negative consequences for broad-based coronavirus deaths, while they were often punished at the ballot box for lockdown-related restrictions.
• The hope and/or intuition on the right is that any pain can be painted as a "period of transition" that's an inevitable part of any revolutionary change.

Zoom in: The model is private sector founder-entrepreneurs, Musk foremost among them, who are often ruthless when it comes to cost-cutting, even as they create companies worth many billions of dollars.

• The hope is Musk can engineer improvements in efficiency and output by cutting federal jobs, in much the same way as he slashed employment at Twitter.

The bottom line: A symptom of trauma is memory loss, and many Americans have largely forgotten how bad the pandemic was.

• That can make them more cavalier in terms of willingness to inflict large-scale disruption all over again, just five short years later.

States are warning that huge headaches are on the way as a wave of fired federal workers try to file for unemployment insurance.

Why it matters: Tens of thousands of probationary workers were abruptly fired across multiple federal agencies, without severance. Many may struggle financially, with broader ripple effects on local economies.

• Unemployment insurance can be a lifeline.

Where it stands: State attorneys general laid out the situation in a lawsuit over the firings filed last week.

• Because the firings happened without any advance notice and in a "chaotic" manner, they're exacerbating strains on state unemployment systems, per the lawsuit.
• States are getting inundated with claims. Maryland now sees 30 to 60 new claims every day. In the first quarter of last year, the state received only 189 jobless claims for federal workers.

The big picture: State agencies are underfunded and underresourced, particularly at this moment when overall joblessness is low, says Michele Evermore, a senior fellow at the National Academy of Social Insurance, who worked on unemployment insurance in the Biden administration.

How it works: The unemployment process for federal workers works differently than the private sector, where employers pay into the system through a payroll tax.

• The federal government doesn't pay up until the firings happen, and is then responsible for reimbursing states and providing agencies with verification on wages and other information, like the reason for "separation."
• Since agencies are giving different reasons for the firings — some citing performance and others restructuring — the unemployment investigators will have to look deeply into each claim, per the lawsuit. That will be a time-consuming process.

Between the lines: Ordinarily, when there are dismissals on a wide scale, they proceed in an orderly way, with advance notice given to states.

• That's not what happened here.

Case in point: Jacob Bushno, a veteran in southern Illinois fired from his job at the U.S. Forest Service on Feb. 18, filed for unemployment right away.

• The state agency is still investigating his claim.
• The battle to get unemployment insurance, on top of the abrupt firing, has "been another struggle," Bushno tells Axios.

For the record: When asked for comment about the status of these workers, the White House declined to address the specific situation. Instead deputy press secretary Harrison Fields said the president has a mandate to uproot "waste, fraud, and abuse."

• "The personal financial situation of every American is top of mind for the President, which is why he's working to cut regulations, reshore jobs, lower taxes, and make government more efficient."

What to watch: We're still at the beginning stages here. Observers expect unemployment claims to pick up in the coming weeks, but for now, some federal workers are waiting to see if they wind up getting their jobs back.

Reach execs and business leaders with Axios.

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Companies aren't talking much about a "soft landing" anymore: that dream scenario where inflation comes down without triggering a recession.

Why it matters: We now have a White House warning of a hard landing, and signs that consumer demand, the bedrock of the U.S. economy, is weakening.

Flashback: Mentions of "soft landing" became a steady drumbeat on earnings calls, peaking around this time last year — when it looked like inflation was nearing the Federal Reserve's 2% target — per data from AlphaSense.

Yes, but: On the bright side, AlphaSense notes there's been no uptick in mentions of "recession" yet.

Reach execs and business leaders with Axios.

We'll help you tell your story in the right way:

• We'll distill your brand’s message into its most effective form with Smart Brevity.
• No clutter, no filler — just clean, smart and effective.

Contact us to learn more.

Thanks to Ben Berkowitz for editing and Anjelica Tan for copy editing. See you tomorrow!