OPINION:
Remember when Barack Obama was president? His administration set low expectations with its “secular stagnation” theory. The U.S. economy could not be great again, they said. The Affordable Care Act and the mislabeled stimulus law created dozens of new ways to discourage work and the health and human capital that goes with work.
When the Trump economy got people back to work with good wages, critics called it a short-lived sugar high that would stoke inflation. But in fact, it would be less than 2%.
The U.S. economy was on a path to make the American dream affordable again for families, young people, everyone. The GOP platform promises to finish the job.
Deregulation and the Trump tax cuts were essential. Prescription drug prices fell for the first time in almost 50 years, thanks to more companies entering the market after then-President Donald Trump lowered barriers. Deregulation reduced internet access prices sharply in 2017. American innovation also made us the world’s leading oil and natural gas producer.
New cars and pickups will cost almost $6,000 more because of the actions of the Biden and Obama administrations. These actions impose Champagne tastes on beer budgets, not environmental protection. Workers can’t come off the sidelines if they can’t afford the car to get there.
Housing is especially unaffordable in Democratic-run areas such as Boston and San Francisco due to tremendous obstacles to building. It’s no accident that the same regions have high rates of homelessness. Let me name some of the parts of a house that are more expensive because of President Biden’s federal policies: microwave ovens, conventional ovens, refrigerators, freezers, washing machines, dishwashers, clothes dryers, water heaters, air conditioners, ceiling fans, furnaces, boilers, heat pumps, lamps and light bulbs.
For the sake of our older adults, we cannot and should not settle for a stagnant economy. An American economy growing at its potential could easily add $1 trillion to the revenue earmarked for Social Security and Medicare.
Nursing homes will be more expensive now that the Biden-Harris administration has given their regulation to special interests. It has presided over record Medicare and Medicaid fraud and improper payments, exceeding the gross domestic product of many countries. It has redirected Medicare funds toward their unworkable climate projects.
Four years ago, regulations already provided environmental and safety protections. Putting the radical left in charge, the Biden-Harris administration has added regulatory costs of more than $40,000 per household, almost twice that of the first Obama-Biden term. The GOP platform promises the opposite.
Regulations don’t much bother the high-paid people in Washington who made them. As a proportion, they cost low-income families seven times as much as they cost high earners.
Democrats treat employers as the enemy and then act surprised when there are too few jobs, particularly for younger and minority workers. The GOP platform promises to end attacks on job creators.
The franchise model, a quintessentially American business practice, allows product innovators and local market experts to concentrate on their strengths. Presidents Biden and Obama have sought to eliminate franchising with their pens and phones.
Mr. Trump gave small-business employees and their families more choices than “Obamacare.” He’ll continue to stand in the way of blue states that tried to impose costly mandates on employers.
Unlike secular stagnation, stagflation is a real thing. Inflation and low wages go together. Inflation is a hidden tax, particularly on the business investment that is essential for making workers more productive.
History has shown that the proven recipe for building the greatest economy in history requires ending inflation and getting Washington bureaucrats out of our business.
• Casey B. Mulligan, a professor of economics at the University of Chicago and senior fellow with the Committee to Unleash Prosperity, served as chief economist at the White House Council of Economic Advisers from 2018 to 2019.
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