There is a lot of talk about how to cover inflation from both Democrats and Republicans. We are seeing various ideas like price caps, scrapping social security taxes, child tax credit, and more options. How do each of these stack up?
To find solutions, we have to divide the economy into sectors. The sectors with the highest inflation are housing, health care, transportation, and education.
The housing price crisis is simple. We did not build enough houses in the 2010s, which led to an increase in prices. Increased demand plus stagnant supply equals inflation. Build housing. That’s the Harris plan. It will work. However, it needs participation from local governments that control zoning laws. Local reforms will solve this problem.
When it comes to transportation, this is because of our addiction to oil and the Russian invasion of Ukraine. Russia is not a major source of oil for the United States, but the oil market is a global market, so simply drilling oil is not going to fix the global price of oil as much as Republicans want you to believe. That’s before the environmental damage. Transition to hydrogen fuel cells and electric cars in rural areas and massively improve transit and implement congestion pricing in cities so transportation costs are reduced for the average American household.
Education has become more expensive because the government cut subsidies. Subsidize education like we used to, and control costs for universities where we can.
The way you do not solve inflation is by pouring money on the inflation fire. That only creates more inflation. That is the Republican plan by cutting corporate tax rates.
https://www.politico.com/news/2024/08/16/harris-economic-policy-plan-00174336