I’m an Economist: These 4 Things Will Be More Expensive If Biden Is Reelected
Despite a series of shocking and tumultuous events rattling both President Joe Biden’s and former President Donald Trump’s presidential campaigns, the race remains tight, the country remains polarized and the election will likely come down to a small number of votes in a few key swing states.
No one can predict the future, but the candidates’ policies, positions and philosophies are fundamentally contrasted — the price of certain things that would rise with the election of one are likely to fall with the election of the other.
GOBankingRates spoke with two economists to find out which price increases to brace for if America re-hires President Biden.
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Oil and Gas
Gas prices were markedly lower during President Trump’s term in office than Biden’s. Presidents don’t control gas prices, and Forbes argued that the price swing had less to do with energy policy and more to do with extraordinary circumstances — the COVID-19 pandemic forced prices down artificially when highways were empty, planes were grounded and factories were closed — and that they began to rise sharply while Trump was still in office.
Even so, some economists expect the price of oil and gas to spike if Biden secures another go at the White House.
“Under a second term for President Biden, we can anticipate that traditional prices of oil and gas would continue to face pressure, with tax proposals targeting oil and gas and a continuance of restrictive regulations,” said Demian Brady, vice president of research for the National Taxpayers Union Foundation (NTUF), whose responsibilities include producing commentaries and studies on fiscal issues, State of the Union analysis and managing the NTUF’s program for tracking the impact of legislation on the size of the federal budget.
“There would likely be additional spending and tax credits to encourage the development of electric vehicles, charging stations and alternative sources of energy, but this would not alleviate the price impacts of fuel and transportation, which has had downstream impacts across the economy,” he said.
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Gas-Powered Cars
It’s not just the price of gas that will likely creep up should Biden persevere in November. The internal combustion engine vehicles that burn it might get more expensive, too.
It’s all but certain that Trump will eliminate Biden’s electric vehicle initiatives and roll back regulations on fuel emissions for gas cars if he’s elected. Another Biden term would be just as likely to have the opposite effect.
In March, the Biden administration published a rule designed to force a dramatic shift from gas-powered to electric vehicle sales in the near future. The Hill wrote, “For consumers, this is expected to mean more available and affordable EVs. Some analysts say it could also have the opposite effect on gas-powered cars, making them pricier and less available.”
The rule is designed to make it difficult for ICE vehicle manufacturers to keep up with evolving EPA standards that will become more stringent over the next few years, making gas vehicles more expensive to build and buy while the price of EVs falls.
If Trump is victorious, the rule’s days are probably numbered. If Biden wins, it will remain in place.
Renewable Energy
Curiously, some economists think the cost of renewable energy could rise right along with oil and gas, which is counterintuitive, considering Biden’s green energy agenda is the polar opposite of Trump’s drill, baby, drill philosophy — counterintuitive, but more plausible than you might think in the green initiative’s early stages.
“In a hypothetical scenario where President Biden gets reelected, the cost of renewable energy products and services will probably rise,” said Chuck Warren, economist and host of the Breaking Battlegrounds Politics Podcast. “This can be attributed to his attention to shifting towards clean energy, which might require more substantial upfront costs, such as those incurred when buying solar panels or electric vehicles, as well as associated infrastructure due to increased demand and regulatory changes.”
Chinese Imports
Even more counterintuitive than a Biden win forcing up the cost of green energy is the prospect of Chinese imports becoming more expensive due to aggressive tariffs — not enacted by Donald Trump, but by his incumbent opponent.
According to the New York Times, China flooded American stores with cheap consumer products during the 20 years leading up to 2016, with sellers like Amazon and Walmart making vast fortunes as consumers consumed like never before.
However, nothing is free, and the tradeoff for cheap Chinese widgets was widespread U.S. factory closures and the evaporation of 1 million manufacturing jobs.
In 2016, voters who were frustrated with lost jobs, stagnant wages and disappearing industry — particularly working-class voters — responded by electing Donald Trump, who campaigned vigorously on protectionist trade policies with China.
He delivered on his promise as president by enacting heavy tariffs, which made many imports more expensive to buy — which was precisely the point. Biden has kept many of those tariffs in place and escalated them even further in May.
No matter which candidate emerges victorious in November, it appears that the era of cheap Chinese imports is in the dustbin of American history.
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This article originally appeared on GOBankingRates.com: I’m an Economist: These 4 Things Will Be More Expensive If Biden Is Reelected