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LARRY KUDLOW: Biden’s extensive spending poses a significant inflation risk

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The Trump administration’s economic policies are not inflationary, despite claims from The New York Times. President Trump’s first term saw minimal consumer price increases, while Joe Biden’s term has experienced a 20% rise in prices. Trump’s proposed policies of increased drilling, tax cuts, deregulation, and tough trade policies did not lead to high inflation during his first term, so why would they in a second? Biden’s massive deficits and spending, along with restrictive energy policies, contribute to inflation.

The US is producing less oil than it could be due to Biden’s restrictions, leading to higher oil prices that impact consumer goods and services. Deregulation and tax cuts have historically lowered business costs and spurred production, wages, and productivity, all of which have a counter-inflationary effect. Open borders and the influx of immigrants have impacted the job market, favoring foreign-born workers over native-born workers. Trump’s proposed deportation of criminal immigrants could potentially impact inflation.

The argument that tariffs cause higher inflation is debunked by evidence showing that inflation did not rise during Trump’s tariff increases on China. Consumers have the option to boycott tariffed goods or force China to lower prices. Tariff reductions with other countries have also lowered costs. The main cause of inflation is excessive spending, which is exacerbated by Biden’s large deficits and the Federal Reserve’s support of that spending. Regulatory and tax threats have stifled small business production, while Trump believes his economic policies can successfully combat inflation if re-elected.

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