Trump Says "America is Back!" | This Week's Economy Ep. 102
Let's cut taxes, tariffs, and government waste!
Hello Friends!
Did you catch President Trump’s address to Congress last week? I’ve shared some key highlights on X. My main takeaway is that he’s addressing American voters’ concerns about the economy head-on. And it’s about time! But will the policy uncertainty and trade war kill the potential growth?
Check out my episode and the show notes below as we dive into today’s top economic headlines. From the impacts of tariffs to the urgent need for new leadership at the Federal Reserve, let’s break down what’s happening in Washington and beyond. Catch the full episode on YouTube, Apple Podcast, or Spotify, and visit my website for more information.
Timestamp
00:00 Trump's Address to Congress: Economic Concerns and Solutions
04:04 The Impact of Tariffs on the Economy
08:00 Government Efficiency and Workforce Reduction
09:57 Central Bank Leadership and Regulatory Challenges
13:49 School Choice Legislation in Texas
18:08 AI Regulation: Balancing Innovation and Oversight
1. TRUMP’S ADDRESS TO CONGRESS
In the News:
Last week, President Trump addressed a joint session of Congress for the first time since returning to the White House. He discussed education, the economy, tax cuts, DOGE’s work, the federal budget, and reducing regulations. Trump acknowledged that tariffs could cause pain to Americans and reiterated his promises to eliminate taxes on tips, Social Security benefits, and overtime pay. Sources: NBC News and The White House
My Take:
Tax Cuts Over Tariffs: Tariffs will hurt Americans more than President Trump acknowledges, damaging industries and raising consumer costs. Instead, the administration should focus on making the Tax Cuts and Jobs Act permanent and reducing corporate and small business tax rates. This would benefit Americans and businesses more than targeted tax cuts on tips, overtime, and Social Security.
Reducing Regulations and Waste: Trump rightly highlighted DOGE’s efforts to address government waste. Though more work is needed, it’s good to see a president focused on reducing the inefficiency and waste that burdens all Americans.
Reset America’s Vision: President Trump’s second term offers a historic opportunity to reset the country with a focus on free markets, limited government, and fiscal responsibility. While his stance on tariffs differs, cutting spending, simplifying taxes, restoring energy independence, expanding free trade, reforming immigration, and slashing regulations are key to building a competitive economy where all Americans can thrive.
Related: Here’s what I said President Trump should do to let America prosper at National Review truly. Also, check out this article by Grover Norquist and Alfredo Ortiz advocating for a 15% corporate tax rate and 25% small business deduction.
2. TARIFF’S TROUBLESOME IMPACTS
In the News:
Following the start of Trump’s tariffs last week, the stock market dropped, and Canada and China quickly retaliated with their tariffs and threats to block some American products. This action particularly impacts U.S. farmers, and some industries are even getting exemptions. Sources: NY Times, Wall Street Journal, and ABC
My Take:
Tariffs Cause Pain: The U.S. has a spending problem rather than a tax revenue problem. Tariffs harm Americans by raising costs, disrupting supply chains, and killing jobs across industries—from oil and gas in Texas to farming in Kansas to tech in California.
Anticipated Policy Mistakes: The likely next move is bailouts for those harmed by failed protectionist policies, as seen during the first Trump administration.
Solution to Tariff Troubles: Trump should end the mercantilist tariff war and focus on cutting government spending, making the Tax Cuts and Jobs Act permanent, and reducing regulatory costs. Instead of punishing businesses and consumers, we should avoid taxing Americans and picking winners and losers. It’s time to end tariffs!
Related: Don’t miss my interview on NTD News, where I discuss the impact of tariffs on inflation and the trade deficit!
3. GO, DOGE, GO!
In the News:
The Department of Government Efficiency (DOGE) has been making significant changes in Washington. Through the Office of Personnel Management, DOGE cuts bureaucracy and dismantles large portions of the administrative state. For example, the IRS plans to reduce its workforce by up to 50%. Sources: CNN, NBC, and PBS
My Take:
An Honest Look at Government: The government doesn't create value but can support or hinder private sector growth through its regulations. As I’ve long advocated—and even Elon Musk has suggested—the government should consider eliminating spending from its GDP measurements.
Dismantling Ineffective Agencies: It's encouraging to see DOGE target agencies that do more harm than good. The Consumer Financial Protection Bureau, with its 1,700 employees, is likely next in line for layoffs.
States Can Follow Suit: States like Texas follow the federal example by creating their own DOGE departments. Texas should seize this opportunity to reduce its bloated government workforce and prioritize taxpayers. The resignation of 77,000 federal employees out of 2.2 million—nearly 3 million including contractors—proves what we already know: government is too big, inefficient, and costly.
Related: I recently shared my thoughts on Texas’s DOGE and how now is the time to restore fiscal sanity on X.
4. URGENT NEED FOR A DEREGULATORY CENTRAL BANK LEADER
In the News:
House Financial Services Committee Chairman French Hill and Senate Banking Committee Chairman Tim Scott led a letter to Treasury Secretary Scott Bessent urging the swift appointment of a Vice Chair for Supervision of the Board of Governors of the Federal Reserve System. They emphasize the need for strong leadership to address Biden-era regulations, maintain accountability, and streamline the Fed’s regulatory functions. Source: House Financial Services and Mornings with Maria
My Take:
End Biden-Era Regulations: This role is the top banking regulator in the country, overseeing policies that impact lending, credit access, and economic growth. If left unfilled, Fed Chair Jerome Powell will consolidate power, keeping excessive Biden-era regulations in place, including Basel III Endgame’s harmful capital requirements that restrict lending.
Urgent Need to Fill Vacancy: President Trump must quickly fill the vacant Vice Chair for Supervision role with a pro-growth, free-market leader to increase transparency and accountability. With crucial banking policy decisions on the horizon, the country needs a regulator who understands the dangers of overregulation and can roll back policies that limit economic opportunity.
A Leader at the Ready: Some strong candidates, such as Michelle Bowman and Kevin Warsh, would be natural fits. Bowman is already on the Fed Board, has experience in financial oversight, and supports a balanced approach to regulation. Warsh is a former Fed governor and economic policy expert who understands financial markets and promotes regulatory certainty.
Related: I share seven reasons why this should be a priority over on X.
5. PASSING TEXAS SCHOOL CHOICE THE RIGHT WAY
In the News:
Texas is close to passing school choice legislation, with support from President Trump and Elon Musk, which is adding pressure on Texas Republicans to act. Sources: Politico
My Take:
Funding a Broken System: Texas spends nearly $100B annually on a failing public school system, yet the House’s HB 2 and the Senate’s SB 26 propose adding another $8B to the same system.
Better Legislation Options: HB 3 and SB 2 offer $1B for school choice through Education Savings Accounts, but that only helps 1.5% of students, leaving 90% stuck in public schools.
Pass School Choice the Right Way: I strongly support school choice, but it’s crucial to do it right. With lessons learned from over 30 states, Texas must fund students, not systems, and ensure we implement universal school choice. Let’s push for the best solution, despite the opposition from the well-funded anti-choice lobby.
Related: Watch Mandy Drogin and me discuss school choice as we dive into how much our schools spend and what they spend it on.
6. PROTECT TEXAS AI INNOVATION FROM OVERREGULATION
In the News:
Texas lawmakers are debating two competing bills to determine the state's future of artificial intelligence (AI). The Texas Responsible AI Governance Act (TRAIGA) (HB 1709) seeks to impose heavy regulations on AI to prevent bias, while the Texas AI Freedom Act (TAIFA) (HB 3808) aims to remove bureaucratic barriers and promote innovation.
My Take:
TRAIGA Will Crush Innovation: TRAIGA creates excessive compliance burdens for AI developers, forcing businesses to navigate costly audits and impact assessments. As compliance expenses trickle down, even small businesses that rely on AI tools from larger firms will face increased costs. California attempted similar regulations, and they backfired—Texas should not make the same mistake.
TAIFA Offers a Smarter Path: The Texas AI Freedom Act, filed by Rep. Brian Harrison, ensures that Texas remains at the forefront of AI innovation by eliminating unnecessary regulations, removing DEI-driven mandates, and creating an AI Advisory Council to foster free-market solutions.
Texas Must Lead on AI: Overregulating AI in Texas will push investment and jobs to other states with smarter policies. TRAIGA would limit AI growth, while TAIFA would unleash it. Texas lawmakers must choose wisely.
Related: The Texas AI Freedom Act: Unleashing Innovation.
Thanks for joining me in this episode of "This Week's Economy." For more insights, visit vanceginn.com and get even greater value with a paid subscription to my Substack newsletter at vanceginn.substack.com.
God bless you, and let people prosper!
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