314. Will Trump Bring Government Efficiency, Economic Freedom, and Growth | This Week's Economy Ep. 87
Exploring Trump’s Cabinet Plans, Inflation Control, Texas Reforms, and Fiscal Conservatism in Louisiana.
Hello Friends!
Welcome again to This Week’s Economy, where we dive into the latest developments in economic policy, state reforms, and fiscal conservatism shaping the future of America.
With President Trump returning to the White House, his administration is already making waves with plans for a “Department of Government Efficiency” (DOGE), led by Elon Musk and Vivek Ramaswamy. We explore what these plans mean for the economy and dive into the latest updates on inflation, energy policy, the Federal Reserve, and key pro-growth initiatives in Texas and Louisiana.
Join me as we unpack the policies shaping your wallet and America’s future. Watch the episode on YouTube below, listen to it on Apple Podcast or Spotify, and visit my website for more information.
TRUMP’S CABINET
In the News:
With former President Trump now confirmed as the election winner to become the 45th and 47th president, he’s starting to build his cabinet. One of the most notable announcements is the creation of a new Department of Government Efficiency (DOGE), which Elon Musk and Vivek Ramaswamy will lead. Sources: CNN and NPR
My Take:
Time for Action: Reining in federal spending is long overdue. The growing federal deficit is a serious threat to our nation’s economic health, and it’s encouraging to see that addressing this issue will be a key priority in the Trump administration.
Public Input: Elon Musk has announced that DOGE will maintain transparency by posting the department’s actions online. It will be beneficial as it will be outside of government, not receive taxpayer funding, and welcome public input, particularly on ideas for cutting wasteful spending, reforming mandatory programs, and eliminating unnecessary regulations.
Path to Success: To be truly effective, DOGE must set clear, measurable targets for cost reduction, including eliminating the hidden costs created by excessive regulations. Only with a focused, data-driven approach, along with Trump's support and the use of his bully pulpit, can the “department” achieve actual savings and improve efficiency.
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INFLATION RISING
In the News:
The latest Consumer Price Index (CPI) report revealed that inflation picked up again in October, with the CPI rising by 0.2% across a broad range of goods and services. Source: Bureau of Labor Statistics
My Take:
Core Inflation at Highest Level Since May: The new CPI report shows that core inflation climbed for the third consecutive month, reaching 3.3%, the highest level since May 2024.
Fed Risks Repeating Past Mistakes: The Federal Reserve’s recent actions are beginning to resemble the missteps of the Great Inflation era when the Fed prematurely loosened monetary policy. That decision fueled sustained inflation and caused market distortions. We must avoid repeating that cycle.
Tackling Inflation: Congress must take urgent action to curb excessive government spending to combat fueling inflation. Meanwhile, the Fed should pause further rate hikes and focus on reducing its bloated balance sheet. Cutting the balance sheet to about 6% of GDP—around $1.75 trillion—would bring it back to pre-2008 crisis levels, providing a more stable foundation for economic growth.
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NUCLEAR ENERGY
In the News:
The U.S. is facing growing energy demand driven by industries like AI, electric vehicles, data centers, and more. Last week, the Biden administration unveiled a plan to expand nuclear power over the next few decades. While the plan outlines ambitious goals, it lacks funding and will depend on Congress and the incoming Trump administration to implement. Energy was a key issue in the recent election, especially in swing states like Pennsylvania, where fracking played a central role. Sources: Axios, National Review
My Take:
A Key Part of America’s Energy Future: The U.S. private sector, not the government, should drive nuclear energy development. Private investment can help create a future of clean, affordable, and reliable energy, powering Americans’ lives and supporting long-term economic growth.
The Role of Fracking and Natural Gas: Fracking has made the U.S. a global leader in oil and gas production, with daily output surpassing 13 million barrels. Much of this growth has been centered in states like Texas and Pennsylvania, which are breaking oil and natural gas production records.
Promoting Energy Independence: We need nuclear energy and natural gas to strengthen American energy independence. Nuclear energy can be part of a sustainable energy mix with continued safety improvements and efficient waste recycling. Governments should remove regulatory barriers to allow markets to drive the most efficient and cost-effective energy production solutions.
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THE FED UNDER TRUMP
In the News:
Federal Reserve Chair Jerome Powell was recently asked about his future under the incoming Trump administration. Powell maintained that U.S. law protects him and other Federal Reserve governors from being removed from office before their terms end. Sources: Reuters, Financial Times
My Take:
End the Fed: The power of the Federal Reserve should not be unchecked, as it limits the freedom of the market and hampers a free society. A central bank monopoly is not in the best interest of Americans. President Trump’s stance on the Fed suggests there could be an opportunity for meaningful reform.
Inflation Control Must Be the Fed’s Top Priority: The Federal Reserve's primary responsibility is managing inflation. Continuing to cut interest rates will only fuel inflationary pressures and erode the purchasing power of American families. The Fed’s actions must prioritize price stability over short-term political goals.
New Fed Chair Needed: When Powell’s term ends in May 2026, President Trump should appoint a new Fed Chair focused on controlling inflation and addressing the Fed’s bloated $7 trillion balance sheet. We need a leader who will restore fiscal discipline and strengthen the dollar, not inflate it further.
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PRO-GROWTH POLICY IN TEXAS
In the News:
As the 89th Texas legislative session approaches, lawmakers in the Texas House and Senate have filed over a thousand bills. Among them, Texas State Representative Brian Harrison and others have introduced a series of bold proposals to advance pro-growth and pro-liberty policies. Source: Texas Tribune
My Take:
Harrison Proposes Winning Policies: Rep. Brian Harrison is championing several key policies that could drive Texas forward. From ending Chevron deference to abolishing property taxes, his proposals reflect a commitment to free-market principles and individual liberty.
Property Taxes: While Harrison has introduced many valuable bills, my top pick is HB698, which seeks to abolish property taxes. Property taxes are fundamentally unjust, as they force Texans to “rent” from the government for their land and homes. This burden makes homeownership harder, especially for low-income families who struggle to build wealth.
The Best Path Forward: While I support eliminating property taxes, Texas needs a clear, realistic path. North Dakota's experience teaches us that eliminating a major tax without a plan can have unintended consequences. The best solution for Texas is to reduce government spending and use budget surpluses to gradually cut property tax rates, ultimately bringing them to zero.
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FISCAL CONSERVATISM IN LOUISIANA
In the News:
Louisiana has kicked off a special legislative session aimed at tackling tax and spending reforms. With a focus on creating a sustainable fiscal future, newly-elected House leaders are debating various approaches to address the state’s high tax burden and spending levels. State officials argue that fiscal reforms are necessary to promote economic growth and reduce Louisiana’s reliance on high taxes, which they say have hindered competitiveness compared to neighboring states. Source: AP News
My Take
Fiscal conservatism—focusing on responsible budgeting, low taxes, and economic freedom—is crucial for Louisiana's comeback. Here’s how Louisiana can steer toward a prosperous future by implementing sustainable fiscal policies:
Prioritize Responsible Budgeting
Responsible budgeting means keeping spending growth in line with what taxpayers can support, typically population growth plus inflation. Louisiana’s current spending exceeds this measure, redirecting private sector resources to public programs. Responsible budgeting keeps government in check and allows taxpayers to keep more of their hard-earned money.Lower Tax Burdens for Growth
Excessive taxes drain resources from families and businesses, limiting economic growth and wage increases. By reducing tax burdens, Louisiana can boost its competitiveness, attract new businesses, and stimulate job creation, following the successful examples of states like Texas, where tax cuts and spending limits have driven sustainable growth.Embrace Spending Discipline
Many states have implemented spending restraints that have paid off in long-term economic stability. Louisiana can look to models like Colorado’s Taxpayer Bill of Rights, which ties spending increases to inflation and population growth, preventing fiscal overreach. Adopting similar measures would signal to investors and residents alike that Louisiana is serious about creating a thriving, fiscally responsible economy.
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