Why Inflation Keeps Rising | TWE 160
New economic data exposes what’s really driving higher prices and fewer choices.
Hello Friends,
Across the country, the story is becoming harder to ignore: affordability isn’t improving — and much of it can be traced back to policy choices. Inflation remains elevated, federal spending continues without discipline, states struggle to deliver meaningful tax relief, and new barriers to investment—such as restrictions on data centers—threaten future growth.
In This Week’s Economy episode, we explore how government expansion, market distortions, and supply restrictions drive up costs and limit opportunity. The result is higher prices, fewer options, and slower income growth for families. We also outline what policymakers can do to change course and move toward a more affordable and prosperous economy.
Watch the full episode on YouTube, Apple Podcast, or Spotify, and visit my website for more information about my work at Ginn Economic Consulting.
ECONOMIC HEALTH CHECK: What We Learned from March Reports
In the News:
The latest Consumer Price Index report showed that in March, CPI jumped 0.9% in a single month, pushing the 12-month headline rate up to 3.3%. Core CPI rose 0.2% in March and 2.6% over the past year—clear signs that inflation is far from gone. The March jobs report showed the economy added 178,000 jobs, the unemployment rate edged down to 4.3%, and average hourly earnings rose 3.5% over the past year. Sources: Bureau of Labor Statistics, CBS News, and BLS Jobs Report
What That Means For You:
What’s Driving Inflation:
March’s CPI report is a warning: inflation remains too high. The Federal Reserve’s balance sheet is still far from normal, and Washington’s policies — tariffs, overspending, and geopolitical uncertainty — are only adding pressure. If policymakers want to help families, they should stop distorting markets and start reducing the size and scope of government.
Job Recession & Slow Economy:
This was a relatively solid month within a labor market that has been sluggish for more than a year, with declines in six of the last fourteen months. But the key takeaway from the same BLS report is this: payroll employment has “changed little on net over the prior 12 months.” That’s the line that matters. Wage growth of 3.5% is finally outpacing inflation —for now — but it’s a thin margin. Families are still facing elevated costs for food, housing, insurance, and energy, leaving little room to get ahead.
A Full Picture:
Broad private-sector hiring remains weak. And when the labor force is shrinking, a lower unemployment rate isn’t nearly as reassuring as it appears. Policymakers should focus on improving affordability by removing barriers to growth — not making it worse through tariffs, excessive spending, and market distortions.
Related Reading: Join me as I examine these economic reports more closely.
FEDERAL POLICY: Is a Spending Plan Emerging?
In the News:
Congress is increasingly surrendering one of its core powers — control over federal spending — by using budget reconciliation to pass massive, partisan funding packages. This process allows one party to direct hundreds of billions of dollars with little input from the minority and limited oversight once funds are allocated. Because reconciliation bypasses the 60-vote threshold in the Senate, it effectively sidelines the minority party. Sources: Bloomberg and E&E News
What That Means For You:
Using the Wrong Tools:
Reconciliation, once a narrow budget tool, is now being used to fund entire agencies and long-term priorities—including a new push to fund the Department of Homeland Security for multiple years. The result is a continued shift of power toward the White House—weakening accountability, reducing Congress’s ability to adapt to changing needs, and further eroding its role as a check on executive authority.
Cut Spending, Not Grow It:
As discussed earlier, federal spending is fueling inflation — and families are paying the price. When even Washington admits the math no longer works, you know the problem is serious.
In recent remarks, House Budget Chairman Jodey Arrington noted that balancing the budget over 10 years would have required about $6 trillion in savings in 2017. Today, that number is closer to $16 trillion — a stark sign of how quickly the fiscal outlook has deteriorated.
What Washington MUST Do:
The reality is simple: the federal government is too large, spends and borrows too much, and has been shielded for too long by a central bank that softened the warning signs policymakers should have faced years ago. Now is the time to act — by reducing spending, adopting firm limits on government growth, and restoring fiscal discipline while there is still time to choose reform over crisis.
Related Reading: I recently examined Washington’s spending habits here:
STATE POLICY: Property Tax Plans
In the News:
Texas Governor Greg Abbott recently outlined his “taxpayer empowerment plan,” aimed at easing the burden of rising property taxes. The proposal includes requiring two-thirds voter approval for tax increases, capping appraisal growth at 3% (down from 10%), shifting appraisals from annual to every five years, allowing voters to roll back increases, and ultimately eliminating school property taxes.
Meanwhile, Ohio voters may soon weigh in on a ballot measure to eliminate property taxes statewide. Sources: KENS5 and Fox 8
What That Means For You:
Texas Must Aim Higher:
Texas is often held up as a model for freedom and prosperity. But if that’s true, why are property taxes still rising, taxpayers still feeling squeezed, and government still expanding?
The real issue is spending. Texans should stop settling for temporary relief and one-time fixes. With disciplined spending and greater transparency, eliminating property taxes should be the long-term goal.
Ohio Shows Promise:
Across the country, homeowners are feeling the strain of rising property tax bills driven by higher home values. Ohio voters may soon have the opportunity to do something about it — by eliminating the tax altogether. If successful, it could strengthen the broader movement and show other states that real reform is achievable.
Real Relief Starts with Spending:
The lesson for every state is clear: you can’t fix a tax problem without fixing the spending problem. As government grows, meaningful tax relief becomes harder to deliver. Fiscal discipline is essential for states that want to remain competitive, affordable, and a place where families can truly get ahead.
Related Viewing: Catch my full episode deep-dive on property taxes and why it’s time for states to eliminate this unjust tax.
REGULATION: Improving Affordability
In the News:
The U.S. Basel III “Endgame” is entering a new phase, with regulators proposing a revised, more evidence-based approach. Federal Reserve Vice Chair Michelle Bowman signaled changes to eliminate overlapping requirements, better align rules with actual risk, and support economic growth while maintaining safety and soundness.
At the same time, new data highlight another hidden cost in the economy: lawsuit abuse. Tort costs reached an estimated $529 billion in 2022 — about 2.1% of GDP, or roughly $4,200 per household — and are projected to exceed $900 billion by 2030. Some essentials, including prescription drugs, home insurance, and health insurance, are hit especially hard which raises prices. Sources: DC Journal, Bloomberg, and National Review
What That Means For You:
The Good News:
When Washington overregulates bank capital, Americans pay through tighter credit and slower growth. Bowman’s approach signals a shift toward smarter regulation—one that better matches rules to actual risk.
Even the Fed’s GSIB surcharge proposal now acknowledges the tradeoff: when risk is overstated, banks pull back from lending and investment, leading to fewer financial services and weaker economic activity.
Lawsuit Abuse Acts as a Hidden Tax:
A sound legal system should compensate victims and deter wrongdoing. But today, excessive litigation often functions as a business model—driving large settlements, enriching intermediaries, and shifting costs onto everyone else. This “tort tax” shows up in higher prices, lower wages, and reduced investment. Families pay for it every day, whether they realize it or not.
Making Things More Affordable:
Reducing regulatory burdens in banking — and addressing lawsuit abuse — can help lower costs across the economy. That’s a welcome shift as families continue to struggle with affordability.
But more work remains. Basel III remains a complex framework, and regulators should continue to simplify rules, tailor them to risk, and avoid one-size-fits-all mandates. And while tort reform won’t solve everything, it would remove one of the most costly and unnecessary burdens on the economy.
Related Reading: See my recent pieces in National Review and DC Journal.
TECHNOLOGY: Data Center Bans
In the News:
Across the country, lawmakers in at least 12 states have attempted this year to slow AI infrastructure by proposing temporary bans on new data center approvals and construction. Most of these efforts have stalled or failed, but Maine has advanced legislation through both chambers, clearing the way for a final vote. Sources: Business Insider and CNN
What That Means For You:
Data Centers Power the Future:
Data centers aren’t a niche luxury—they are the backbone of modern commerce and communication. They power GPS, cloud services, online banking, streaming, AI tools, and real-time business operations. States should want more of them. But that requires building the energy and water infrastructure to support growth, not blaming rising demand for exposing policy failures.
Strain is Not the Same as Scarcity:
Grid strain doesn’t mean data centers are the problem — it often means supply has been constrained. A growing economy will use more resources. The solution isn’t to restrict growth, but to expand supply.
Policymakers should allow costs to be reflected in market prices, not imposed through blunt regulations or bans. When resources are tight, markets drive efficiency through pricing, contracts, and innovation—not political limits.
Choose Abundance Over Barriers:
Data centers are not the enemy—they are essential to prosperity, security, and modern life. The goal should be abundance, not restriction. That means faster permitting, more energy generation, improved water pricing with clear property rights, and greater reliance on private infrastructure solutions.
Related Reading: I explain why data centers are critical to winning the global tech race in my guide.
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!
