Beware the economic pitfalls, Mr. Trump: You must rely on your all-star team
If you’re under the impression that President Trump inherited “a strong economy,” as an NPR headline claimed recently, guess again.He’s got his work cut out for him.Take the monthly inflation rate.
It reaccelerated to a 17-month high in the last month of the Biden administration.Combine that with a $36 trillion national debt, a labor market that is much weaker than previously estimated, and deteriorating federal finances, and it’s clear Trump has a real mess through which to navigate.If Trump wants to deliver on his vow of a new “Golden Age,” he’ll need to rely on the sober wisdom and expertise of his team while avoiding the pitfalls into which many of his predecessors fell.First, it will take a whole-of-government approach to fix the current cost-of-living crisis—because the entire federal government was involved in creating the disaster in the first place.
America needs to increase energy production, cut taxes and regulatory red tape, renegotiate international trade, and drastically cut spending out of Washington, D.C.Fortunately, there is much overlap in those goals.Reducing taxes and burdensome regulations will create a more business-friendly environment for American energy producers.
That will reduce costs and increase production.Reopening federal lands to exploration and drilling will bring further supply online.America is also perfectly positioned to export vast quantities of energy worldwide.
The U.S.has a four-to-one cost advantage over Europe when it comes to natural gas and natural-gas-derived chemicals; that’s a golden opportunity to increase exports, close the trade deficit, and boost both economic growth as well as national income.Growing energy exports is just part of how Trump will have to juggle today’s highly imbalanced international trade situation.
Tariffs will certainly be in the mix, but there’s a right way and a wrong way to implement them.President Hoover is one of the best examples of how not to apply tariffs.Th...