278. 6 Election Tips for Trump and Harris | This Week's Economy Ep. 74 📈

My latest insights on the top national and state news of the week.

Hello Friends!

I hope you’re well! Please check out episode 74 of This Week's Economy. Today, I discuss Harris copying Trump to end federal income taxes on tips, Texas energy issues, Trump and the Federal Reserve, inflation’s influence on the election, a possible recession, and school choice in Texas.

Watch the episode on YouTube below or listen to it on Apple Podcast or Spotify.

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1. HARRIS CALLS FOR NO FEDERAL TAXES ON TIPS

News: VP Harris recently backed a proposal to eliminate federal income taxes on tips—a move previously championed by former President Trump. But is this enough to win over voters?

My Take:

• The bipartisan appeal of exempting tips from federal income taxes, even endorsed by Libertarians, misses the bigger picture. This policy does nothing to curb the federal government's chronic overspending. Reducing revenues without any accompanying spending restraint could exacerbate the deficit and further distort the tax code by picking winners and losers.

• Many Americans are grappling with economic hardships exacerbated by high taxes and persistent inflation, potentially on the brink of a recession. Instead of narrowly focused tax policies, we need comprehensive solutions like expanding the Trump-era tax cuts, which benefit all American households.

• The real issue is Washington’s out-of-control spending. Congress must take serious steps to slash federal spending and implement a strict monetary rule to prevent the Fed from further economic manipulation.

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2. TEXAS ENERGY CONCERN

News: Despite West Texas natural gas prices trading below zero for much of the year, Texas struggles to get this vital resource to consumers.

My Take:

• Texas is blessed with abundant natural resources, particularly natural gas. This reliable energy source is crucial for the state’s growing population.

• However, increasing government intervention—through mandates for ESG investing, potential carbon taxes, and subsidies for wind and solar—is undermining the market principles that have driven Texas’s energy success.

• Texas should embrace a light-touch regulatory framework that encourages competition and innovation through market forces. Removing barriers to private investment in energy production and distribution, such as ESG mandates, will ensure a competitive market that reduces costs, improves service quality, and fosters technological advancement.

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3. TRUMP AND THE FEDERAL RESERVE

News: President Trump recently suggested that presidents should have more influence over the Federal Reserve, a sentiment echoed by VP candidate JD Vance and some of his advisors, who plan to change the Fed if he is re-elected.

My Take:

• While the President indirectly influences the Fed through appointments, history—like with President Nixon—shows that presidential pressure on the Fed can lead to negative outcomes.

• To truly tackle inflation and economic instability, the focus should be on addressing federal deficit spending, which fuels the Fed’s money-printing practices. This can be achieved through sustainable budgeting rules.

• The Federal Reserve must expedite reducing its bloated balance sheet and adhere to a strong monetary rule to restore Americans' purchasing power. Too much money chasing too few goods is a recipe for inflation.

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4. INFLATION AND THE ELECTION

News: Inflation remains a top issue as the election season heats up, with both Harris and Trump pledging to tackle it. Harris, in particular, has vowed to combat "price gouging" by companies.

My Take:

• If VP Harris truly had the power to stop inflation, why hasn’t it been done already under the Biden administration? The reality is that neither the president nor Congress has much control over inflation.

• Instead of targeting businesses, politicians need to acknowledge their role in perpetuating inflation. The root of the problem lies in excessive government spending and the Federal Reserve’s money-printing.

• By reigning in spending and controlling the money supply, Congress and the Fed can stop distorting the market, driving up the cost of goods and services for American families.

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5. RECESSION APPROACHING?

News: Concerns are growing that the U.S. may be headed toward a recession, particularly after the disappointing July jobs report triggered the Sahm Rule.

My Take:

• The U.S. has been on a troubling economic path, driven by the federal government's relentless deficit spending. This spending has led to higher taxes, inflation, and interest rates, all hurting Americans.

• A recession seems likely at this point, and while it may temporarily worsen the current situation, correcting the market distortions caused by government overreach could be necessary.

• To navigate through this, we must get a grip on government spending. By unleashing the private sector through free-market capitalism and pro-growth policies—like reducing spending, cutting taxes, lowering regulations, and controlling money printing—we can emerge stronger and more resilient.

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6. SCHOOL CHOICE IN TEXAS

News: The Texas House Committee on Public Education recently held a hearing on educational opportunities in Texas. Texas is the largest red state and does not have school choice, even though 12 other states have universal or near-universal school choice.

My Take:

• Despite historic increases (my testimony) in public education funding recently and over time, student performance in Texas is flat or declining. Texas needs to catch up, as many states have educational opportunities that are unavailable here.

• Economist Milton Friedman once said about improving education, "The only solution is to break the monopoly, introduce competition, and give the customers alternatives."

• The time is now (my research) for Texas to follow this vision with a “Texas approach” for improved education, more pay for quality teachers, and a better economy.

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Media Hits and Other:

• I’ve published pieces, given quotes, and completed interviews this week at Pelican Institute on the bad Google decision and problems with government-mandated ESG actions, Kansas Policy Institute on improving state budget processes, Mackinac Center on overspending in Michigan, KTRH News on large corporations laying off workers, and more.

Let People Prosper Show

• Don't miss the latest Episode 109 of the Let People Prosper Show is a great discussion with Steve Moore (not Randy Hicks as I indicated last time, as his episode will be next Tuesday!), an economist and author, serving as a senior fellow at the Heritage Foundation and a co-founder of The Committee to Unleash Prosperity, and author of Trumponomics: Inside the America First Plan to Revive Our Economy.

• This upcoming Tuesday’s Episode 110 of the Let People Prosper Show is an excellent discussion with Randy Hicks, president of Georgia Center for Opportunity, on how to overcome poverty through community-based solutions rather than top-down government policies.

Quote of the Week

Bible Verse of the Week

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Conclusion

Thanks for joining me in Episode 74 of "This Week's Economy." For more insights, visit vanceginn.com and get a paid subscription to my Substack newsletter at vanceginn.substack.com today so you receive these insights in your inbox. God bless you, and let people prosper.