Economic Growth Stands on a Three-Legged Stool: Tariffs, Taxes, and Regulations
Economic growth does not happen by accident. It is built—deliberately—on sound policy choices that reinforce one another. Our growth model rests on three solid legs: tariffs, taxes, and regulations. When these are aligned correctly, the results speak for themselves.
President Trump’s instincts on economic policy have been consistently right. For years, so-called experts warned that tariffs would ignite inflation, crush consumers, and stall growth. The predictions were dire. The reality has proven them wrong.
Tariffs have not caused inflation.
In fact, the opposite has occurred. Core inflation now stands at 1.1%, one of the lowest readings in a long time. That is not theoretical—it is measurable fact. The inflation panic pushed by anti-tariff economists simply has not materialized.
What those economists failed to account for was the massive wage disparity between U.S. wages and offshore wages. This disparity created a powerful absorption mechanism, as foreign producers modulated prices—trading inflated margins for market-share retention rather than passing costs on to American consumers. I have repeatedly described this phenomenon as the “Wage Disparity Tariff.” It acted as a shock absorber, neutralizing the inflationary impact critics insisted was inevitable.
President Trump himself captured this dynamic when he spoke of an “External Revenue Service”housed within the Department of the Treasury—recognizing tariffs not as consumer taxes, but as a strategic tool to realign global trade behavior in America’s favor.
At the same time, economic growth has surged to 5%. We were repeatedly told that growth above 2–2.5% was impossible in a mature economy. Yet here we are—well beyond that artificial ceiling. This is not a sluggish recovery; it is a booming economy, and it is poised to accelerate even further. Once again, the economists assured us such growth could never happen—yet here it is.
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