When Joe Biden took office in January 2021, he inherited the Trump economy. An economy on the path to recovery from the COVID pandemic – a country experiencing rapid job growth, a strong stock market, and a resurgence in consumer spending.
Instead of fostering this economic recovery with pro-growth policies, or simply sitting back and doing nothing, the Biden administration implemented an economic agenda of excessive government spending, overregulation, and a war on oil, all of which drove inflation and stalled the then robust economy.
Sadly, because of the failed economic policies of the Biden administration, the U.S. economy, and the American people, are facing economic headwinds which may well reach deep into 2025. Fortunately, the Trump administration is pursuing a handful of policies which will return the American economy to strength and greatness, and the American worker to greatness.
The first major economic misstep of the Biden administration was the passage of the nearly $2 trillion American Rescue Plan (ARP) in 2021, which did little except to throw gasoline onto an already hot economy.
At a time when the economy was on the mend and inflation under control, Biden unnecessarily printed money and poured it into the economy, flooding it with cash. As a result, inflation surged to 9.1% in 2022, a rate not seen since 1981, squeezing household budgets and eroding Trump-era wage gains.
To combat this inflation, the Federal Reserve aggressively raised interest rates, bringing them from near zero in 2022 to over 5% in late 2023, an increase of more than 150%.
Mortgages skyrocketed, with the average 30-year rate surpassing 7%, making home ownership all but impossible for first-time homebuyers, and forcing many who wanted to sell their homes to remain in place, creating a scarcity of housing inventory, driving up prices.
During this time, Biden expanded welfare programs, including extending unemployment benefits, and illegally forgave student loan debts. This discouraged workforce participation, exacerbating labor shortages.
As inflation continued, real wages stagnated, or declined, leaving Americans struggling to pay for essentials such as food, gas, and housing. Savings eroded, credit card debt reached record levels, and people began defaulting on mortgages and car payments.
Biden’s war on fossil fuels and his support of the Green New Deal Mafia contributed to higher energy costs and supply chain disruptions, while depleting the nation’s strategic petroleum reserve, and sending billions to America’s oil exporting enemies such as Iran and Venezuela.
Biden’s economic hangover continues today, hindering President Trump’s current efforts to reinvigorate the American economy.
Inflation remains stubbornly high today, at 3% for the year ending January 2025. Jobless claims are increasing as well, passing 240,000 in the latest report from the government, as companies prepare for an economic slowdown. While energy prices are coming down, Americans are still feeling the price at the pump, as they are at the grocery store, as Bird Flu has resulted in 166 million chickens, turkeys, and ducks being culled, driving the price of both eggs and poultry to astronomic levels.
There is a path to near term economic recovery, and the Trump administration is pursuing six critical paths to economic recovery, growth, and prosperity.
First, the administration is working to get government spending under control. Trump has done this by forming the Department of Government Efficiency, DOGE, under the influence of Elon Musk. This new organization has already identified billions in governmental waste, fraud, and abuse in one month. It has also worked to make the government more efficient by updating IT infrastructure. If nothing else, the work of DOGE has made the American people feel that, finally, the government may be spending their money in a responsible manner.
Second, Trump is working to make the Tax Cuts and Jobs Act of his previous term permanent. This would stimulate the economy by avoiding the largest tax increase in American history and giving the American consumer the confidence needed to spend and invest.
Third, the administration is pursuing more deregulation. From accelerating approvals for new American factories, to expedited oil exploration permits, reversing regulation removes the chains from American businesses and fosters investment, all of which stimulate the economy in a non-inflationary manner, creating growth.
Fourth, implementing tariffs to protect domestic industries will stimulate the economy and will not be inflationary. As a free-market economist, this pains me to write, but it is needed, especially the reciprocal tariffs on countries who put import tariffs on American goods such as cars, bourbon, and energy. A pro-tariff policy will either encourage direct investment in the United States or level the playing field for American business — either of which will stimulate employment.
Fifth, continue to pursue energy dominance. Rolling back green energy regulations and mandates that currently discourage oil and gas exploration, and hinder energy exports will boost the energy sector, reduce the cost of energy, and provide working Americans with much needed additional disposable income.
Sixth, the administration must continue to control the border and deport those in the United States illegally. The presence of these illegal workers, those who do work, drives down wages for American citizens. The removal of these illegal workers will help American workers’ wages grow and recoup the losses caused by inflation under the Biden administration.
President Trump and his administration are pursuing the correct strategies to recreate and surpass the pre-COVID Trump economy. He must continue to act boldly and aggressively to drive these changes as fast as possible and help the American worker.
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Jim Nelles is a Navy veteran and supply chain consultant based in Chicago. His articles have appeared in the Washington Examiner, Newsweek, Foxnews.com, and the Daily Wire. He has served as a chief procurement officer, chief supply chain officer, and chief operations officer for multiple companies.
The views expressed in this piece are those of the author and do not necessarily represent those of The Daily Wire.
