Matthew Mitchell

Joe Biden surrounded himself with people who embraced modern monetary theory, a heterodox academic fad that taught you could write as many blank checks as you liked without the consequence of inflation. Larry Summers, Bill Clinton’s Treasury secretary, warned Democrats not to go down that road. Conservative economists warned Democrats not to go down that road. Biden listened instead to the modern monetary theorists and their loud defenders online, ultimately signing a $1.9 trillion spending bill on top of everything else, and gave the country inflation that peaked at 9.1 percent in June 2022. Democrats paid for it at the ballot box. Unfortunately, President Trump has made a similar mistake. He has surrounded himself with men who staked out heterodox views on the economy decades ago and now treat his administration as a laboratory. Peter Navarro has spent his career pushing trade theories that nearly the entire economics profession rejects, and he once propped up his own books by quoting an expert named Ron Vara, who turned out to be Peter Navarro. Outside the White House, Oren Cass, a lawyer and former management consultant with no formal training in economics, founded a think tank, gave himself the title of chief economist, and has become the most prominent defender of the tariffs on the right. Around them is a chorus of loud social media defenders who insist tariffs are a tax on foreigners. The MMT crowd promised that massive spending would not cause inflation. It did. The tariff crowd promised that tariffs would not raise prices or hurt wages. They did both. We no longer have to argue about it as a matter of theory. We have the data. The tariffs raised prices and held down wages. The administration now refuses to change course. That is arrogance. It is also bad politics. The tariff regime has turned into a favor generator, with exemptions going to whoever hires the right lobbyist. Voters now rank corruption as a top concern for the first time in a generation. Republicans are heading into a midterm with voters angry about prices, angry about corruption, and trusting Democrats more than Republicans on the economy. Much of that is self-inflicted, and the tariffs are the biggest self-inflicted wound of all. ewerickson.substack.com/i/21…