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Economics 101: Harris v. Trump

Are you better or worse off than you were four years ago? I have some strong feelings about that question as a citizen and a voter. But as your Treasurer, I wanted to simply share my views from the perspective of a state financial officer.

Certainly, there is little that Vice President Kamala Harris and former President Donald Trump agree on. Nonetheless, they do find unity on one fact: Inflation is a problem. How they deal with it, however, differs greatly.

For full disclosure, I have endorsed Donald Trump for President in my private capacity, but today’s article isn’t about that. It’s just about the policies they’ve proposed and the impact they could have on you and your family.

One of the hallmarks of Harris’ economic plan is a proposal to penalize companies when they’re forced to increase prices due to inflation, supply chain issues, and the like. While there were few specifics provided in the policy platform, the idea of government-mandated pricing has long been rejected in America – and for good reason.

American innovation relies upon the free market, where healthy competition and good ideas drive pricing down and increase the availability of new products, industries, and career fields. Government mandates don’t do that. As Shark Tank’s “Mr. Wonderful,” Kevin O’Leary, put it when discussing the Harris proposal: “They tried that in Venezuela, Cuba, North Korea, the USSR. No, that’s not going to work.”

Former President Donald Trump’s anti-inflation proposal is different. He is promising to unleash the country’s potential by cutting red tape and delivering job creators more freedom to operate. We saw the impact of that under his first administration. In fact, if fully implemented, the deregulatory action he took would have increased the real incomes of Americans by $53 billion per year from 2021 through 2029. Government mandates can’t do that; freedom can.

A second significant tenet of Harris’ economic platform is a $25,000 incentive for first-time homebuyers. I’ll grant you this: It sounds good. But economists were quick to raise red flags. First, when you give $25,000 to everyone bidding, everyone will simply bid $25,000 more – that drives inflation. Second, this money is coming from taxpayers, thereby pushing government spending beyond the current unsustainable levels.

Trump’s housing platform, however, “will rein in federal spending, stop the unsustainable invasion of illegal aliens which is driving up housing costs, cut taxes for American families, eliminate costly regulations, and free up appropriate portions of federal lands for housing.” It’s a proposal based upon the age-old idea (and one that has historically worked) that increasing supply will drive down prices.

As a state financial officer, I have long believed a smaller, less expensive government that allows the free market to work is key to economic growth. That’s the strategy I’ve fought to implement in Mississippi – and it’s working.

There is much more to each candidate’s plans – and I encourage you to do your own homework on each. Then, take the time to ask the question: Are you better off today than you were four years ago?