Everything Trump Wants to Do Causes Inflation
This is an edition of The Atlantic Daily, a newsletter that guides you through the biggest stories of the day, helps you discover new ideas, and recommends the best in culture. Sign up for it here.
TL;DR
- President Trump announced a "Trump Dividend" of $5,000 for every adult citizen if Republicans win the House and Senate.
- The proposal is criticized as an inappropriate attempt to bribe voters, potentially illegal, and likely to cost $1.3 trillion.
- The payments are unlikely to occur, as similar promises have not been followed through and the proposal surprised many advisors and lawmakers.
- Injecting $1 trillion into the economy would inflate the deficit, national debt, and drive up prices by increasing demand.
- Trump's other policies, such as a war in Iran and immigration crackdowns, also have inflationary consequences by disrupting oil supplies and reducing labor in key sectors.
- Protectionist policies, like tariffs, are inherently inflationary by definition as they increase the cost of goods.