Tackling sticky high prices

OPINION:

Taxes, tariffs and terrible government spending were my topics when talking to students at the University of Wisconsin-Madison this week. So many of them were trying to figure out what was really happening in the economy and what the impact would be on them.

A recent Young America’s Foundation poll showed that tax cuts were the most popular item on President Trump’s agenda for 18- to 29-year-old voters. They are still concerned about high prices, so it makes sense that they want to keep more of their hard-earned dollars to help pay their bills.

One of the most important things members of Congress can do right now is pass a budget that extends the tax cuts signed by Mr. Trump in 2017. Failure to do so will result in a more than $4 billion tax increase on the American people, as the tax cuts will soon expire.

Despite the rhetoric from the left and many in the media, the Trump tax cuts gave the largest cut to low-income working families. Under the Trump tax cuts, their federal tax rate fell to the lowest in 40 years. Working families making $20,000 to $30,000 annually, the largest income group, received a 13.5% tax cut. Historically, the bottom half of earners paid less income taxes than ever.

The Tax Policy Center found that about 86% of middle-income households would get a tax cut from the 2017 Tax Cuts and Jobs Act. If Congress fails to extend these tax reductions, 70% of the expirations fall on American families making less than $500,000. If that happens, the chairman of the House Ways and Means Committee estimates, a family of four with a median income of $80,610 would get a $1,695 tax increase — all the more reason to pass a budget with an extension of the tax cuts.

Opponents of Mr. Trump’s tariffs claim they will massively increase the tax on the American consumer. Anyone who read “Trump: The Art of the Deal” understands that this was the president’s initial bargaining position. His announcement Wednesday that countries that did not retaliate against the United States would be included in the 90-day pause made my point. The markets reacted with a surge. At the same time, he announced a 125% tariff against communist China as retaliation for its actions.

During my tenure as governor of Wisconsin, I spoke with Mr. Trump several times about trade. In particular, I remember talking to him as he attended the Group of Seven summit in 2018. There, he offered to remove all tariffs and restrictions on trade if the other industrial countries did the same for the United States. None of them took him up on his offer, further fueling his argument that we are getting bad deals from other countries.

My hope is that we get as close to zero tariffs as possible while leveling the playing field for trade, which would greatly benefit American manufacturing and workers. China has long been a barrier to us, much like the Soviet Union was until President Reagan brought it to its knees with a booming American economy and extensive defense buildup.

Ironically, some politicians screaming the loudest about the tariffs and their potential impact on prices oppose extending the Trump tax cuts. Many of the same politicians voted for trillions and trillions of dollars in new government spending.

Rising inflation, overwhelmingly driven by out-of-control government spending, drives high prices. From the beginning of 2021 to the beginning of 2025, prices went up for food, fuel and housing. It was Bidenomics, and many believe that was why Vice President Kamala Harris lost the November election.

Government spending soared at the end of 2020 and continued long after the COVID-19 crisis. Prices went up after the “Inflation Reduction Act” as government spending at the federal level continued to grow and grow and grow. This was a big reason Mr. Trump ran on the idea that he would cut waste, fraud and abuse through the Department of Government Efficiency.

Liberals now falsely claim that Mr. Trump, Elon Musk and others on his team want to cut Social Security. That is a lie, as I repeatedly declared on CNN last week. Radicals and many in the corporate media are repeating this falsehood.

Young people, like most of us, overwhelmingly want to be able to pay our bills. The best way to provide relief is to extend the tax cuts to hardworking taxpayers, move quickly to restore free trade so that the United States and other nations are on a level playing field, and rein in the out-of-control government spending that is driving up prices.

• Scott Walker is president of Young America’s Foundation. He served as the 45th governor of Wisconsin.