President Trump, who during the election campaign vowed to “eliminate”inflation nightmare,” signaled his focus on the high cost of living in America by signing an executive order on Monday that requires “all executive departments and agencies to provide emergency cost relief” to Americans.
Mr Trump's 20th January Order Several factors have been blamed for the pandemic-era inflation surge, which has left many families feeling the pinch financially, including higher federal spending under the Biden administration and costs from new regulations.
“It is critical to restore the purchasing power of the American family and improve our quality of life,” the executive order states.
To accomplish this, Mr. Trump is ordering departments and agencies under the executive branch, including the departments of Commerce, Health and Human Services, Labor, and Energy, to lower prices for everything from housing and health care costs. Can be done. Food and fuel.
Given that the US electorate continues to decline, much is riding on Mr Trump's mandate rank The economy and inflation are among his top issues. But some economists say whether Mr. Trump's order will meaningfully move the needle on inflation is uncertain.
“Trump's cost of living order fails to address the root causes of inflation, namely corporate profiteering and broken supply chains,” said Lindsey Owens, executive director of the progressive economic think tank Groundwork Collaborative. “This order is a matter of discussion, not a plan.”
recent economic Research People like former Federal Reserve Chairman Ben Bernanke have noted that price increases in 2021 and 2022 stem from factors such as supply-chain disruptions and rising commodity prices – which would make it difficult for any president, including Mr Trump . to control.
The Trump administration did not immediately respond to a request for comment.
Meanwhile, inflation has eased dramatically since reaching a 40-year high in June 2022, although the consumer price index remains stubborn above The Federal Reserve's 2% annual rate target. While prices are slowly rising, more than 4 in 10 Americans express pessimism about their economic prospects over the next year due to the ongoing impact of inflation, Bankrate found in December. survey,
Mr. Trump's plan: deregulation, affordable housing and more
Mr. Trump's order targeting prices highlights several areas for federal departments to focus on, including reducing the number of federal regulations, which Trump administration officials argue would harm American businesses. The cost of living has increased for families.
“In summary, the Biden Administration's unprecedented regulatory harassment is estimated to cost the average American family approximately $50,000,” the order said.
This refers to an analysis by University of Chicago economist Casey Mulligan, whose Research found that the Biden administration's rules could add about $47,000 in additional costs per household over time. Mulligan estimates that fuel emissions regulations from the Obama and Biden administrations are projected to increase the cost of each vehicle by $6,000.
But eliminating federal regulations that protect workers and consumers won't lower the cost of living, Owens said. Americans have been struggling with cost-of-living issues for decades, ranging from rising health care costs to rising housing prices – trends rooted in structural problems like this one. shortage of available housing and the country's complex profit-based health care system.
Certainly, Mr. Trump agreed to some of the issues in his order, including directing federal departments to “reduce housing costs and expand housing supply” and “reduce unnecessary administrative expenses and increases in health care costs.” There was a need to end rent-seeking practices.
While those are ambitious goals, tackling housing costs is notoriously difficult, as new construction is often hampered by state and local laws, from zoning restrictions to environmental regulations – issues over which the federal government is unlikely to have much leverage. Is.
Lowering medical costs can help American families who spend more on health care than any other developed nation. Yet Mr. Trump also signed one executive Order Joe Biden administration cancels January 20th Efforts to reduce prescription costsWhich appears to be contrary to their cost of living directive.
Separately, Mr Trump signed a separate executive order on January 20 announcing national energy emergencyPart of his administration's plan to increase domestic energy production and reduce costs.
“The inflation crisis has been caused in large part by overspending and rising energy prices,” Trump said Monday. “And that's why today I will also declare a national energy emergency. We will drill, baby, we will drill.”
Mr. Trump might get some help explaining that he has a recipe for lowering prices. only about 2 out of 10 Americans They said they were “extremely” or “very” confident that Mr. Trump would be able to make progress in reducing the costs of groceries, housing or health care this year. survey From The Associated Press-NORC Center for Public Affairs Research. About 2 in 10 are “moderately” confident.
in one Interview Along with Time magazine, which named him its 2024 Person of the Year, Mr Trump acknowledged that reducing food costs would be a difficult challenge.
He said, “I would like to bring them down. It's hard to bring things down once they're up. You know, it's very hard. But I think they will.”