The Truth with Lisa Boothe: Tariffs, Trade, and the Fed: The Battle for America's Economic Future

Summary

Podcast Summary: The Truth with Lisa Booth – Tariffs, Trade, and the Fed: The Battle for America's Economic Future

Podcast Information:

• Title: The Clay Travis and Buck Sexton Show
• Episode: The Truth with Lisa Booth: Tariffs, Trade, and the Fed: The Battle for America's Economic Future
• Host/Author: iHeartPodcasts
• Release Date: July 31, 2025

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Introduction

In this insightful episode of The Clay Travis and Buck Sexton Show, Lisa Booth delves deep into the current state of the American economy, dissecting the impacts of President Trump's trade policies, tariffs, and the Federal Reserve's monetary strategies. Joined by E.J. Antoni, an economist from the Heritage Foundation, the discussion unpacks the administration's approach to trade deals, the Federal Reserve's recent decisions, and the broader implications for America's economic trajectory compared to the Biden administration.

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1. Shifts in Trade Policy and New Trade Deals

Lisa Booth opens the conversation by highlighting recent developments in trade deals under President Trump's administration, particularly with the European Union and Japan. She emphasizes the shift away from political rhetoric towards more sound economic strategies.

• E.J. Antoni's Analysis:
  • Trade Agreements: "We're getting greater access to foreign consumer markets. American exporters are going to be able to export more. That increases the demand for American exports and it increases the demand for the American labor producing those exports." [03:04]
  • Historical Context: "President Trump is essentially overturning an international trading system that's literally 80 years old. After World War II, we allowed Europe to put all these trade barriers in place so that their industries would not have to compete with ours... There is no reason that 80 years later that same international trading order should still be in place." [04:15]

Notable Quote:

"Trump is really the first president in over 40 years to not be beholden to a lot of special interests, particularly international special interests." – E.J. Antoni [05:37]

Discussion Points:

• Economic Benefits: Enhanced access to foreign markets boosts American exports, job growth, and wage increases, particularly benefiting the blue-collar workforce.
• Overhauling Established Systems: The administration's efforts to dismantle outdated trade barriers are seen as a positive move towards more free and fair trade.

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2. Impact of Tariffs on American Businesses and Consumers

The conversation transitions to the effects of tariffs on American businesses, using Procter & Gamble (P&G) as a case study to illustrate the mixed outcomes.

• E.J. Antoni's Perspective:
  • Short-term Effects: "There will be some increases in prices in the short run on a lot of these products." [07:41]
  • Long-term Outlook: "As you start shifting some of this production to the United States and you couple that with tax and regulatory reform, you actually get a net decrease in your production costs." [09:00]

Notable Quote:

"The net effect right now, it's mixed. There's no way to tell yet which magnitude is going to outweigh each other—are the price increases going to outweigh the price decreases or vice versa?" – E.J. Antoni [09:15]

Discussion Points:

• Consumer Choices: Tariffs lead to varied impacts across different products, with some prices rising and others stabilizing or decreasing over time.
• Incentivizing Domestic Production: The combination of tariffs (the "stick") and incentives for local manufacturing (the "carrot") aims to reduce dependency on foreign imports and lower production costs in the long run.

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3. Federal Reserve's Monetary Policies under Scrutiny

A significant portion of the episode focuses on the Federal Reserve's recent decisions, President Trump's public criticism, and the internal disagreements within the Fed.

• President Trump's Critique:

  • Public Confrontation: "President Trump recently visited the Federal Reserve headquarters. I called it sort of like a public flogging... Calling Jay Powell out for not lowering interest rates and then also for going so grossly over budget on the renovations at the headquarters." [12:07]
  • Fed's Dissent: "The Fed governors dissented, which is the first time that's happened since like 1993." [12:15]

• E.J. Antoni's Analysis:

  • Historical Dissents: "Multiple dissents were actually increasingly common... It's only been in recent decades where we've had these Fed regimes of kind of one person rule." [13:02]
  • Criticism of Jay Powell: "Powell has played a key role in destroying the middle class's upward mobility over the last several years. There's really good reason for firing him, quite frankly." [16:12]

Notable Quotes:

"The increasing dissent is a good thing. Hopefully, it's a sign of more individual thinking at the Fed instead of just this group think." – E.J. Antoni [14:00]

"Powell has completely botched the job... The first Trump administration was the best deregulation that we saw in American history." – E.J. Antoni [17:20]

Discussion Points:

• Federal Reserve Accountability: President Trump's direct challenge to the Fed underscores tensions between the administration and the central bank.
• Monetary Policy Failures: Criticisms focus on high interest rates, inflation control, and questionable financial decisions, including the Fed's costly renovations.
• Political Influence: E.J. Antoni argues that the Fed has been influenced by political biases, hindering its effectiveness in managing the economy.

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4. Economic Comparison: Trump vs. Biden Administrations

The conversation culminates in a comparative analysis of the American economy under Presidents Trump and Biden, highlighting shifts in growth, inflation, and wages.

• Wage vs. Inflation:
  • Under Biden: "Despite the average American's weekly paycheck grew about 20%, prices grew even faster... the paycheck bought 4% less than it had four years earlier." [29:00]
  • Under Trump: "The average American's weekly paycheck now buys about 1% more than it did when he took office." [29:30]

Notable Quote:

"We're finally seeing the average American's wage growth outpace inflation... That's reversed from the Biden years." – E.J. Antoni [30:15]

Discussion Points:

• Economic Recovery: Positive trends indicate improvements in wage growth and trade, though challenges like the cost of living crisis persist.
• Regulatory Environment: Significant deregulation efforts are credited with potentially being the most impactful in American history, fostering a favorable environment for economic growth.
• Future Outlook: While progress is evident, the economy has yet to fully recover to pre-pandemic levels, emphasizing the need for continued policy efforts.

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5. Implications for the Future and Policy Recommendations

E.J. Antoni offers forward-looking insights and policy suggestions to sustain and enhance the economic recovery.

• Monetary Policy Adjustments:
  • Restructuring Fed Operations: "Banks have to keep a certain percentage of their money in reserve at the Fed. They don't get paid interest on it... they'll loan it out to the private market." [23:46]
  • Reducing Federal Debt Costs: Lower interest rates could reduce the federal debt servicing costs, currently at about $1.2 trillion annually. [26:00]

Notable Quote:

"If we go back to the previous requirement, banks will loan out their reserves, leading to more capital formation and lower treasury yields." – E.J. Antoni [24:30]

Discussion Points:

• Enhancing Private Sector Growth: Encouraging banks to lend more freely can stimulate private sector investments and economic expansion.
• Fiscal Responsibility: Reducing the cost of servicing federal debt alleviates the burden on taxpayers and improves fiscal health.
• Policy Balance: Striking the right balance between deregulation, fiscal policy, and monetary policy is crucial for sustained economic prosperity.

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Conclusion

The episode presents a robust analysis of the American economy's current state, highlighting the transformative impact of President Trump's trade policies and the contentious role of the Federal Reserve under Jay Powell. E.J. Antoni from the Heritage Foundation provides a critical perspective on monetary policy failures and underscores the necessity for continued economic reforms. While acknowledging the significant progress made in wage growth and trade accessibility, the discussion emphasizes the ongoing challenges related to the cost of living and the need for strategic policy interventions to ensure long-term economic stability and growth.

Final Notable Quote:

"We're heading in the right direction. We're sobering up, but it still really hurts." – E.J. Antoni [33:32]

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Key Takeaways:

• Trade Reforms: President Trump's administration is actively renegotiating trade deals to benefit American exporters and workers.
• Federal Reserve Critique: Increased dissent within the Fed signals potential shifts towards more independent and data-driven policies, despite current leadership challenges.
• Economic Recovery: Positive indicators like wage growth outpacing inflation reflect improvements, but significant hurdles remain in fully restoring the pre-pandemic economic landscape.
• Future Policies: Recommendations include restructuring Fed operations to encourage private lending and reducing federal debt costs to bolster overall economic health.

This comprehensive discussion provides listeners with a nuanced understanding of the complex interplay between trade policies, monetary strategies, and their collective impact on America's economic future.

Transcript

[Lisa Booth]

This is an iHeart podcast.

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[E.J. Antoni]

Foreign.

[Lisa Booth]

Welcome to the Truth with Lisa Booth, where we cut through the noise to get to the heart of what matters to you. So today we're talking about Trump's economy. With inflation cooling and the Federal Reserve fumbling, President Trump has been pushing for lower rates, smarter trade deals, and executing his vision of the Golden Age of America. Today we're going to talk to E.J. and Tony. He is an economist over at the Heritage Foundation. We're going to talk to him about all this, exposing the Fed's failures, you know, how we can get the economy under control, and most importantly, what is the state of the economy in America today, particularly compared to Biden's economy? So we'll dig into all that. Also, these big trade deals that President Trump's getting done, what does it mean for you? What's the significance of all of it? So stay tuned for my friend E.J. and Tony from the Heritage Foundation. E.J. and Tony, it's great to have you back on the show. The last time we had talked, you know, there was some uncertainty around tariffs. It was after Liberation Day. Everyone was kind of trying to figure out what this would mean for the country, what it would mean for the economy. You know, now it's been a little bit of time. What's sort of like your reflection and where do you see things now that were a little bit removed? And there's been some trade deals, especially the big one with the eu.

[E.J. Antoni]

Well, Lisa, I'm really, really happy to see that since our last conversation, the administration has really course corrected here. They've gotten away from, from some of the kind of political talking points and I feel like they're getting back to more sound economics. And that's being reflected in, in these different trade deals that are getting done. And the various agreements you mentioned, the one with the eu, we also have a recent one with Japan. And in each of these instances, we're getting greater access to foreign consumer markets. So that means American exporters are going to be able to export more. That increases the demand for American exports and it increases the demand for the American labor producing those exports. So you're going to be looking for not only more job growth, Lisa, in these different industries, but also faster wage growth too. And that's really important for an American middle class, especially blue collar workers who have been so beaten down by inflation outpacing their wage growth over the last four years. So really good news on that front. And again, very, very positive to see the administration not talk so much about the trade deficit and some of these metrics that don't necessarily matter, at least not in the way they're talking about them. And very, very positive to see them moving towards these different agreements that are actually going us more free trade, not less. It'll give us more interaction with different economies around the world because again, it's giving us better access to those foreign consumer markets. It really is amazing how President Trump is essentially overturning, especially in the case of the EU, he's overturning a international trading system that's literally 80 years old. After World War II, we allowed Europe to put all these trade barriers in place so that their industries would not have to compete with ours because they were trying to rebuild their industries from the devastation of World War II. There is no reason that 80 years later that same international trading order should still be in place. And yet somehow Trump is the first president to question it and to say we need to improve this and get a better deal for the American people, specifically the American worker. So that's all a very, very positive development.

[Lisa Booth]

Why do you think he's the first to say, hey, wait a minute, like this doesn't make sense for America. We need to change it? Like, why hasn't anyone tried it before?

[E.J. Antoni]

Him That's a really great question, Lisa, and if you'll allow me to speculate here a little bit.

[Lisa Booth]

Oh yeah, it's because I do it all the time.

[E.J. Antoni]

Well, I think it's because Trump is really the first president in, I mean, at least over, over 40 years really, to not be beholden to a lot of special interests, particularly international special interests. Ironically, it took the New York City billion error to be the most connected with the common man, with the average Joe, with the blue collar worker across the heartland of this nation. And again, I think that's because he's not beholden to a lot of special interests, which include a lot of foreign special interests. If you look at previous presidents, it doesn't matter if it was Biden, if it was either of the Bushes, if it was Obama. So many of those guys, really, all of those guys were beholden to donors, including ones who had key international stakes. And so there was a vested interest in maintaining, in my opinion, in maintaining the existing post World War II International Trading System. And I think that's why you never saw any real progress made to dismantle it. Even the landmark trade agreements that we had, things like NAFTA, never did anything to give us that kind of greater access to foreign consumer markets that foreign exporters have had. In terms of our consumer markets. There was never a two way street because there were too many special interests that didn't want it.

[Lisa Booth]

You know, and we've been able to raise a bunch of money from the tariffs so far. But then you're also seeing things like, you know, Procter and Gamble recently said that they've had like the weakest sales growth since 2018, that they planned some layoffs and two, they're also planning on raising prices on 25% of its North American products. They're saying because of tariffs and product innovation. Is what they're saying is that like a Proctor and Gamble problem or is this as a result of the tariffs and like where kind of where is this all heading?

[E.J. Antoni]

Well, it's a bit of a mixed bag, honestly. So you're going to have some instances where tariffs are passed on to consumers, but not in all instances. You know, this is kind of like. Well, let me put it this way, Lisa. If you have as a consumer alternatives, when you go to the store and you have five or six different products all more or less the same thing, and one brand might be slightly different from another. One brand might be made in America, another might be made in Europe, one's made in Canada, whatever the case may be Tariffs are not going to affect all of those products. The same markets are dynamic. And so we have to anticipate dynamic effects here. And even the foreign made products, companies who source their products from a location, again, you know, in Canada and Mexico and China and Europe, they're going to start changing whether they increase their prices, whether they source their products from a different location. There are a lot of different, again, dynamic effects that we have to take into account here. And there will be differences between the short run effects and the long run effects. It would not surprise me if you get increases in prices in the short run on a lot of these products, but then you actually get not only a decrease back to the baseline in the long run, but a further decrease even after that. Because as you start shifting some of this production to the United States and you couple that with tax and regulatory reform, you actually get a net decrease in your production costs because you not only avoid the tariffs by moving production here to the United States, but now producing in the United States is cheaper than it was previously. So this is kind of the whole carrot and stick approach that the administration is doing. The stick is tariffs. If you don't produce stuff here, you'll pay a tax, an import duty, but also there's a carrot. If you produce here, you're going to get tax and regulatory benefits that you never saw before. And so again, it's going to be a very mixed bag. You will actually see some consumer products in the long run go down in price. You will see some go up in price, but the net effect right now, it's mixed. There's no way to tell yet which magnitude is going to outweigh each other. Are the price increases going to outweigh the price decreases or vice versa?

[Lisa Booth]

We've got to take a quick commercial break, more with EJ and Tony on the economy on the other side.

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[Lisa Booth]

You know, President Trump recently visited the Federal Reserve headquarters. I called it sort of like a public flogging. You know, seemed like it was an embarrassment ritual to, to call Jay Powell out for not lowering interest rates and then also for going so grossly over budget on the renovations at the headquarters. We have recently found out that the Fed will not lower interest rates and there was some dissent within the Federal Reserve. Like I think you had to Fed governors dissent, which is the first time that's happened since like 1993. So kind of a big deal. Why do you think that decision was reached? What does it tell you that there was sort of discord and disagreement within the Federal Reserve. You know, what's your, what's your takeaway from all that?

[E.J. Antoni]

Well, Lisa, you're absolutely right. It was the first time you had more than one member of the board of governors dissenting in over 30 years. That's significant. Now, it's not unprecedented. In fact, if you go back further into the Fed's history, multiple dissents were actually increasingly common. It's only been in recent decades where we've had these Fed regimes of kind of one person rule, if you will, where the Fed chairman comes down with his dictate or her dictate from on high and then everyone just kind of has to follow along regardless of what the data says, regardless of what their personal feelings on the matter are. So I actually view the increasing dissent as a good thing. Hopefully it's a sign of more individual thinking at the Fed instead of just this group think, which has led to absolute disaster. But kind of taking a broader view here, 30,000 foot view, so to speak. I think Trump's visit to the Fed was a good move on multiple levels. It lets them, look, we're watching you. You don't get to run amok here in terms of these renovation costs. You could have knocked down all of the Fed's building and rebuilt them from scratch for a lower price than the cost of these renovations. So that's certainly pretty asinine on the Fed's part that they're doing this. The opulence of the renovations is also, I mean, it's not only ostentatious and in bad taste, but it's especially in bad taste from the standpoint of how much the American people are, are suffering right now because of the Fed's monetary malfeasance. So again, the President going in there and letting everybody know, look, we're watching you guys. This is not going unnoticed. I really like that move. I also really like the fact that the President is continuing to exert pressure on the Fed, essentially telling them, look, you guys cut interest rates last year during an election season. What I think was blatant election interference. You did that when inflation was worse than it is today. All of the indicators are actually more in favor of a rate cut now than they were in the autumn. But why did we get 100 basis points of cuts back then? In other words, a full percentage point, specifically because it was an election. And if you look at political donations from people who work at the Fed, the ratio is literally 90, 10. It's 90% go exclusively to Democrats and only 10% to Republicans. There is clear political bias. You can also see that in the so called research. I'm using air quotes here for the so called research that the economists that the Fed produce. It is overwhelmingly in favor of Democrat talking points. It's not based on sound economics. It's not based on empirical analysis necessarily. So again, I like the fact that the President is exerting some authority here. The Fed is clearly acting from a political standpoint. They clearly, they're clearly political animals. They are neither data dependent nor politically independent. That is very, very clear if you look at the record.

[Lisa Booth]

So it's fair to say that Jay Powell is a big lib with Trump derangement. Syndrome.

[E.J. Antoni]

Well, there's certainly a whole lot of animosity between the two of them. And I'm not saying the President has done anything to help that, that's for sure. He certainly has not been playing nice in the sandbox. But, but maybe he shouldn't. I mean, Powell has completely botched the job. And it's not as if that's a recent phenomenon. Lisa, we forget that going back to the first Trump administration, Powell was raising rates the entire time before COVID when there was really no reason to do so. He was operating on this ludicrous idea that somehow economic growth causes inflation. And so the faster Trump got economic growth to move, the more Powell said, well, we have to keep raising rates. That's part of the reason why the Trump economic miracle from the first term was just that, a miracle. He was working against the Fed the entire time. And then Powell gave Biden all the low rates he wanted until inflation shot up to 40 year highs. And then Powell gave us the fastest interest rates, interest rate hikes also in over 40 years. It's been a complete disaster. Powell has played a key role in destroying the middle class's upward mobility over the last several years. I mean, there's really good reason for firing, firing him, quite frankly.

[Lisa Booth]

Well, see, that's what I was thinking. I know after the visit he said he wasn't going to fire them, but the way I read that, you know, off of. No, you know, not, not based on any internal knowledge or anything, but like the way I kind of read the visit was this. Was Trump potentially setting him up for a four cause firing, like highlighting to the public. Here's this guy who has grossly misused, abused your money like they're way over budget, right? Like, sort of like I felt like that was kind of like the leading the horse to slaughter a little bit if he needed to. Is that like fair or, you know, I don't know. Do you, do you read that the same? Because I know that to fire him, you know, there has to be a quote unquote, for four cause under the Federal Reserve act. And it typically is some sort of misconduct, conduct, malfeasance, like negligence. There's gotta be, you know, some big legitimate reason you're firing the Fed chair. But I kind of felt like he was teeing him up for that.

[E.J. Antoni]

Yeah, you're exactly right, Lisa. And I think that analysis is, is spot on that this could definitely be Trump doing his art of the deal, so to speak. Well, maybe it's more Sun Tzu, right, Where, you know, You're. You're setting your enemy up for failure, essentially, and you're exposing him to the eyes of the world. I think that's a very, very good point. And I do think there is absolutely cause for firing Powell on multiple levels, not just these crazy cost overruns and whether or not there might be some malfeasance there and some misuse of taxpayer dollars. Again, why are we spending all of this money on gold inlays and imported marble for the Federal Reserve building? Was that a misuse of taxpayer dollars? And look, people have this crazy idea that somehow the Fed's expenses do not come out of the taxpayer's pocket. They absolutely do, just not directly. Right. If the treasury has an expense, it's a little easier to see that that is directly coming out of the taxpayer's pocket. But people forget that the Fed is mandated by its charter that you just mentioned, the Federal Reserve Act. The Fed is mandated to turn over to the treasury all of its profits. We call those remittances. And because of complete mismanagement, the Fed hasn't had any profits since September of 2022. Instead, they're over $235 billion in the hole because of their cumulative losses, again, since the fall of 22. But all of the profits that the Fed has not earned, that have been replaced with losses now are not being turned over to the Treasury. And who has to make up for those losses? Well, the taxpayer does. Any of the money that is not going to the treasury ends up adding to the deficit because it's a receipt essentially for the Treasury. It's on the revenue side of the balance sheet, and it's been removed. So, again, the taxpayer has to make up for that. Every additional expense by the Fed, every loss of revenue by the Fed is an indirect cost to taxpayers, but a cost nonetheless. And so every dime that the treasury has spent on these renovations has indirectly been paid for by the taxpayer. But on top of that, the Fed has, again, they've completely botched the job on inflation, on interest rates. That has helped create the cost of living crisis we're in today. And on top of that, Jerome Powell has actually violated the Fed's charter because they have been essentially illegally funding the Consumer Finance Protection Bureau, which is a very odd entity, not so much in the fact that it's Elizabeth Warren's personal regulatory attack dog that she sicks on whatever conservative group she wants, but more so because the CFPB does not get its funding through the normal congressional appropriations process. Instead, it gets its operating expenses paid for out of the profits at the Fed. So the Fed takes a portion of its profits and then sends that over to the cfpb. Well, the problem is, as we said, the Fed hasn't had any profits since September of 2022. So instead, what the Fed has been doing was literally creating the money to send to the cfpb, which it is not allowed to do. Nowhere in its charter does it have the authority to do that. It may have the power to do that. Clearly it does. But it hasn't been granted the authority by Congress to do that. And so Powell has actually been illegally funding the cfpb, which again, is cause for firing him. So there's plenty of reasons if we really want to go down that road. Granted, it'll cause a bunch of court battles, it'll be a drawn out process. You know, it'll cause market turmoil. But I think there is cause for firing him if you want to risk that market turmoil.

[Lisa Booth]

And I mean, he's out pretty soon. Right? So.

[E.J. Antoni]

Right. And that's exactly. Lisa, that's a great point.

[Lisa Booth]

Is that turmoil worth it just to wait it out?

[E.J. Antoni]

Bingo. You hit the nail on the head. It's a typical cost benefit analysis. He's out by May. And not only that, but we'll get a Fed chair named and probably confirmed by the Senate before May. And so once markets see who is coming in and once markets see what monetary policy is going to look like as soon as Powell is removed, markets will anticipate that because that's the nature of markets they are anticipating. Anticipatory. If you look at stock prices, what justifies stock prices, future company earnings? Well, you don't have future company earnings today, by definition. Right. They're for the future. So markets are always anticipatory in nature. And once they see who the next Fed chair is likely to be and then will be again after the confirmation process, markets will already start adapting to the future monetary policy before it's even put into place. So I don't even think we'll necessarily have to wait until May before we see the economy really adapting to Powell's replacement.

[Lisa Booth]

So what's he denying to the people you had mentioned previously, the harm it's done to the middle class.

[E.J. Antoni]

Well, the big thing right now, if we take kind of as a given all of the past mistakes, so we can't go back and fix them. Right. This is not about the damage Powell has already done. But what is, as you said, Powell denying to the American people today by not acting by kind of maintaining the status Quo. The status quo here, Lisa, is not just interest rates, but it includes a lot of other failed Federal Reserve policies, too. Not the least of which is Powell has been paying banks and other financial institutions to not lend money. He has been paying them instead. You could call it to lend money to the Fed. If these institutions keep money parked at the Fed, whether it's by paying interest on reserve balances or interest paid out through something called the reverse repurchase agreement operations at the New York Fed, these are all different mechanisms by which the Fed is getting money to stay parked in its own vaults instead of being lent out in the private sector. And not just to the private sector, but also to the Treasury. Powell has now set up this bizarre scenario where the private sector and the treasury have to compete with the Fed for liquidity. So one of the things driving treasury yields higher today, in other words, the interest that the treasury has to pay on the federal debt is the fact that they have to offer a rate that beats the Fed. And it's not just a rate that beats the Fed in terms of just looking at the interest rate. The Fed is allowing people to keep money parked on a daily basis, so there's no liquidity premium. In other words, your money is tied up for 24 hours, and then you get it back. So that's a really, really great deal. The treasury, on the other hand, is asking you to keep your money tied up for either several weeks in the case of treasury bills, or several years in the case of treasury notes, or many years in the case of treasury bonds, which are 20 or 30 years. So there's a huge liquidity premium attached to it. So if the Fed is willing to pay you 4.4% interest for some of these operations, in order to keep your money tied up for only 24 hours, you're going to require much more to keep your money tied up for 30 years. And that's where you're getting these yields on treasury bonds in excess of 5%. What Powell really should be doing is stopping all of that entirely. We should go back to the previous requirement, which is banks have to keep a certain percentage of their money in reserve at the Fed. They don't get paid interest on it. And now banks will be out there looking for a rate of return on their money. They will go to the private market and loan it out, so we'll get more capital formation that way, which will help growth in the private sector. And they will also be loaning it to the treasury, which will help bring down treasury yields. So it's not just a matter of lower interest rates would do things like reduce people's cost to borrow money for a home or reduce people's financing charges on their credit cards. But on top of that, it would also help taxpayers by reducing the cost to service the federal debt. And that's something a lot of people aren't talking about today when they should be, because we're paying about $1.2 trillion a year right now to service that debt. That's a huge expense to the taxpayer. It accounts for most of the deficit.

[Lisa Booth]

Gotta take a quick break. If you like what you're hearing, please share it on social media or maybe send it to a friend. More with EJ on the other.

[E.J. Antoni]

Are.

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[Lisa Booth]

Care of the rest.

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[Lisa Booth]

Sort of looking at the economy today compared to before President Trump took office, like, where do things stand today versus where they were under Joe Biden? Like, what's the state of the economy? How would you assess the strength of our economy today? I mean, it seems like the rest of the world would place it at a, you know, at a high degree, considering the fact everyone wants access to our markets based off of these trade deals. But sort of like, how would you assess the strength of the American economy today?

[E.J. Antoni]

Well, Elise, I think you're really right on, on the direction, you know, things are looking up. We have a lot of, a lot of positive indicators. Like you were saying, all of these foreign interests who really, really want to make sure they maintain access to American consumer markets and they're willing to make concessions because of that. This is all a result of the President realizing that he can wield the American consumers purchasing power like a weapon on the world stage. That's paying a lot of dividends right now. On top of that, you're finally seeing the average American's wage growth outpace inflation. In other words, not only is their weekly paycheck getting bigger, but it's buying more too, because the paycheck is growing faster than prices are. Under Biden, it was exactly the opposite. We've talked about this a lot on your program how despite the fact that the average American's weekly PayCheck grew about 20%, which is huge, in only four years, the problem was that prices grew even faster. So by the end of Biden's term, the average American's weekly paycheck bought 4% less than it had four years earlier under Trump. Again, that's reversed. The average American's weekly PayCheck now buys about 1% more than it did when he took office. So you can see things are moving in the right direction. But you can also see we haven't made up for all the lost ground. We've still lost ground compared to when Trump first left office or compared to these different pre pandemic measures. So again, I would define this economy as one that is moving in the right direction, but it's still not all sunshine and rainbows. We have lost a tremendous amount of ground. We are still in a cost of living crisis. The cost of living is still way too high. American standard of living is still way too low. And so we need to keep making progress before we will even get back to where we were, let alone before we can actually start making Progress. Compared to 2019 levels, again, in terms of standard of living and cost of living, but again, I'm very optimistic, not only from the trade deals and agreements and those frameworks that are coming in. The international front is looking better, but the domestic front, we're seeing a lot of progress there, too. The one big, beautiful bill, it might not have been the legislation that I would have written. There were some things in it I loved. There were some things in it I certainly didn't love. But overall, net positive, the deregulatory efforts that we are seeing from this administration could very well be the best we have ever seen in American history, because what we saw during the first Trump administration was literally the best deregulation that we saw in American history. And this second Trump administration right now is poised to top it because of the whole of government approach that they have taken, where every department and every agency is doing what they can to roll back these burdensome regulations. So, again, all of those things pointing in the right direction, the dials are really lining up here on the machine. But we have to be honest and we have to be realistic about where we are coming from. And we have to acknowledge, I think, the pain that the American middle class is still facing today. Just because things are moving in the right direction, just because things are getting better, doesn't mean they're okay yet.

[Lisa Booth]

All right. But you're saying there's a chance that we're gonna get back.

[E.J. Antoni]

Absolutely. Exactly. And that's why. And you know, that's why I'm optimistic, kind of. You know, Lisa, if I. If I can use the analogy here, where we're at right now is. Is kind of like Sunday morning after you went out and had too much to drink Saturday night, Right. So you went out Saturday night, you had way too much to drink, and now you feel like absolute garbage. Well, maybe that was the second half of the Biden years, was when you felt like absolute garbage. Now it's later in the morning on Sunday, so you're feeling a little bit better, you're sobering up, but your head is still pounding. Right. And it's going to be a while. It's going to be a few more hours before you're really feeling better. That's kind of where we're at economically. So we're heading in the right direction. We're sobering up, but it still really hurts.

[Lisa Booth]

Although the good news is I don't do that to myself as much anymore. So.

[E.J. Antoni]

Amen.

[Lisa Booth]

We've grown up, E.J.

[E.J. Antoni]

That'S right. We can't. Even if we wanted to. I don't think we could.

[Lisa Booth]

E.J. and Tony, thanks for coming on. Really always appreciate your insight and just appreciate connecting. Thanks so much my friend Lisa.

[E.J. Antoni]

Always My pleasure. Love the show.

[Lisa Booth]

Show. There's EJ and Tony over at the Heritage Foundation. Appreciate him for making the time to come on the show. Appreciate you guys at home for listening every Tuesday and Thursday, but you can listen throughout the week. I also want to thank my producer John Casio for putting the show together. Until next time.

[E.J. Antoni]

Ah, come on. Why is this taking so long? This thing is ancient.

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[E.J. Antoni]

Whoa, this thing moves.

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[Lisa Booth]

This is an I Heart podcast.