If Donald Trump becomes president, he’s going to wave a magic wand on his first day in office and poof! The cost of food, energy, insurance, and many other things will suddenly plunge.
This is the gist of Trump’s riff on inflation, which he used to blame on President Joe Biden and now blames on Vice President Kamala Harris. When Biden was the Democratic presidential candidate, the inflation that peaked at 9% during his second year in office was a major electoral liability. Now that Harris has replaced Biden, Trump obviously hopes voters will transfer their anger over inflation onto her.
If the president had the power to single-handedly slay inflation, you might think Biden would have done it. Biden, in fact, did just about everything possible: releasing oil from the national reserve to lower energy prices, jawboning retailers and producers about “corporate greed,” and attempting to block corporate mergers that might dilute competition. Yet the rate of inflation has only fallen gradually and most of the price hikes of the last three years remain.
There’s not very much any president can do to lower prices in a free-market economy driven by supply and demand. Yet Trump insists he will be uniquely deflationary. In campaign speeches, Trump routinely highlights the inflated cost of groceries, gasoline, electricity, insurance, and housing. “Prices will come down,” Trump promised on Aug. 11 . “You just watch. They’ll come down and they’ll come down fast, not only with insurance, with everything.”