How Trump Can Cut Prices — Even in a Trade War

As America’s trade war escalates, voters are worried about one thing above all: rising prices. An Associated Press poll shows just 36 percent approve of the president’s handling of the economy. Many are saying there is no longer a path forward for the president to keep his campaign promise of reducing inflation.

However, this is far from the case. Even with the tariffs in place, the administration can still drive inflation down by cutting through regulatory red tape.

While trade wars can raise prices on imports, bloated and unnecessary regulations push costs even higher. Cutting red tape and letting markets work again would bring prices down fast. Look no further than energy prices.

On his first day in office, President Biden revoked the permit for the Keystone XL pipeline, halting a project that would have brought in 800,000 barrels of oil daily. He followed that by freezing new oil and gas leases on federal lands and waters, where nearly 25 percent of U.S. oil production comes from. The result? Gasoline prices, which averaged $2.39 per gallon when Biden took office in January 2021, soared to $5 per gallon by June 2022, significantly affecting families and small businesses.

Trump can bring energy prices back under control by continuing to restart pipeline projects, reopen federal lands for responsible production, and signal that American energy is open for business again.

Permitting reform is another golden opportunity to reduce consumers’ prices during this trade war.

Right now, it takes years of environmental reviews and legal wrangling to build a pipeline, power plant or manufacturing facility. These delays choke off supply, raise energy and housing costs, and deter private investment. Streamlining permitting processes, reducing unnecessary building approval delays, and fast-tracking domestic production would help bring cheaper energy, increased housing supply, and potentially lower rent and housing prices. The Permitting Technology Action Plan launched in May represents a significant start to doing this.

Let’s not forget the antitrust policy. Under Biden, federal enforcers pushed prices higher by allowing the government to break up businesses even when they were lowering prices and benefiting consumers overall.

For example, the Justice Department sued Visa’s debit network under the belief that big always equates to bad. It did this even though businesses have warned that acting against a favored debit network could lead to price increases across the board, and despite Visa already facing stiff competition from other debit card companies such as upstarts Square, Stripe and Apple Pay. Trump can and should restore a pro-consumer enforcement process at the Justice Department that stops punishing companies for lowering prices and being successful.

Americans want results; they don’t care how they materialize. All they want is to see their grocery bills to decrease, energy costs to stabilize, rent prices to decrease, and transaction fees not to rise. By tearing down the regulatory barriers that inflate prices, Trump can deliver the economic relief families need, no matter what’s happening with his trade talks.

Reprinted with permission from DC Journal by Andrew Langer.

The opinions expressed by columnists are their own and do not necessarily represent the views of AMAC or AMAC Action.