He’s partly right: tariffs are bad. But blaming them alone is like blaming your waiter for the price of the menu. The deeper truth is this: you’re paying monopoly prices at the fair, inflated prices at the store, and rising costs across the board — because government at every level is too big, too expensive, and too involved in the economy.

And while Democrats like Talarico, and too many Republicans, love calling out the pain, they also champion policies that pour gasoline on the fire.

​First, Let’s Talk Economics: Why Fair Food Costs So Much
​
The Texas State Fair isn’t a competitive market — it’s a closed-loop economy. You’re not allowed to bring outside food or drinks. There’s no nearby food truck park or Whataburger to force price discipline. Once you’re through the gate, you either pay the fair vendor price… or go hungry.

That’s textbook monopoly-style pricing — not because each vendor is a literal monopoly, but because the fair environment restricts competition and substitutes.

This is what economists call inelastic demand in a captive market. Prices can soar because people still pay them. A turkey leg isn’t worth $25 anywhere else — but at the fair, it is. Why? No substitutes. No competition. High fixed costs. Limited supply. And vendors are recouping fair fees, equipment costs, and labor in a short window.

So yes, prices are high — but they’re not “greedy.” They’re what the market, constrained as it is, will bear.

Now zoom out: the same logic applies when government controls or distorts markets — whether through tariffs, subsidies, zoning laws, tax codes, or regulatory barriers.

You restrict substitutes, limit competition, and suddenly… prices rise, choices shrink, and the average family gets stuck footing the bill.

Now Add Tariffs and Inflation to the Mix

Tariffs are part of this problem. They’re taxes on imports — sold as “protecting American jobs,” but really just hiking import prices for American consumers. Want cheaper things? Kill tariffs.

But again, tariffs are just one slice of the cost pie. The much bigger problem is inflation driven by out-of-control government spending.

Here’s how it works:

1. The federal government spends more than it collects in taxes.
2. The U.S. Treasury issues debt to cover the gap.
3. The Federal Reserve buys that debt — effectively printing new money.
4. More dollars chasing limited goods = higher prices across the economy.

And this isn’t just some DC story. It’s happening locally, too — school districts and cities issuing billions in new bonds, raising property taxes, and growing bureaucracies.

Texas Is a Warning Sign, Not an Exception

On this November’s Texas ballot alone, voters will weigh in on billions in new local debt, including:

• Conroe ISD – $1.9 billion
• Northside ISD (San Antonio) – $1 billion
• Fort Worth ISD – $1.3 billion
• Galena Park ISD – $530 million
• Manor ISD – $351 million
• Travis County ESD – $276 million

All pitched as necessary and noble. But let’s be clear: every one of these will raise the cost of living down the line. This is inflation by design, not by accident.

Politicians approve massive spending. They pass it to voters in the form of debt. The debt gets monetized. The money gets devalued. And your fried Oreos end up costing $14.

Both Parties Are to Blame

Let’s not pretend this is just a Democrat problem.

Republicans at every level have voted for bloated budgets, massive borrowing, and corporate handouts dressed up as “economic development.” The Trump tariffs that Talarico criticizes are real — and they are wrong. But so were Biden’s tariffs, subsidies, mandates, and regulatory burdens that deepen the inflation spiral.

This is a bipartisan fiscal crisis. Red states, blue states — doesn’t matter. If you’re overspending and borrowing beyond your means and pushing the bill to taxpayers, you’re part of the problem.

Inflation Picks Winners. Government Picks the Winners. You Lose.

The most dangerous part of all this? Government inflation doesn’t hit everyone equally.

• Businesses can raise prices.
• Government workers get COLA increases.
• Bondholders get repaid with devalued dollars.
• Politicians get re-elected for “investing in the future.”

But working families? Small businesses? Retirees? They lose — every time.

Nothing is free — not “free” school lunches, not “free” infrastructure, not “free” turkey legs. Everything has a cost. And when government distorts the economy, it picks winners and losers — always.

Here’s the Better Path

We don’t need more performative outrage from politicians like James Talarico. We need real reform:
✅ End tariffs — stop taxing Texans for voluntary trade.
✅ Cap spending at every level to less than population growth plus inflation.
✅ Audit local bond debt and stop endless borrowing.
✅ Shrink the scope of government to lower the cost of living.
✅ Let people in markets — not bureaucrats — set prices and priorities.

You want cheaper fairs, groceries, housing, and healthcare? Then it’s time to shrink government. Not grow it. Who’s coming with me?

This is not “mission accomplished” territory. It’s more like “inflationary trench warfare.”

The Fed’s Real Problem: Its Balance Sheet

The real driver of persistent inflation isn’t a mystery — it’s the Fed itself. The Fed’s balance sheet now sits at $6.6 trillion, down from the nearly $9 trillion peak during the COVID lockdowns but still far above the $4 trillion pre-pandemic level (Fed data). That’s ~23% of GDP being steered by unelected central bankers, distorting credit markets, propping up asset prices, and undermining the purchasing power of the dollar.

This massive balance sheet expansion was used to monetize unprecedented federal spending under both the Trump and Biden administrations — flooding the economy with cheap money that helped trigger the price spikes we’re still paying for today. Unless the Fed aggressively unwinds these holdings, inflationary pressures will keep simmering.

Why Rate Cuts Now Would Be Dangerous

The Fed’s current target range for the federal funds rate is 4.25–4.50%, and there’s a growing chorus — including two dissenters at the latest FOMC meeting — calling for cuts. They’re making the same mistake they made in 2021 when they claimed inflation would be “transitory.”

Here’s the reality:

• Inflation has been above the Fed’s 2% target since March 2021.
• The Fed’s target is “flexible,” but flexibility doesn’t mean tolerating a three-year miss, especially on the high side.
• Cutting rates now would further fuel asset bubbles, weaken the dollar, and penalize savers while inflation remains above target.

The Fed should hold rates steady until inflation is consistently below 2% for several months — and even then, only if the balance sheet is meaningfully smaller.

The Bigger Picture: Monetary Manipulation Hurts the Poor Most

Inflation isn’t just a number — it’s a hidden tax that hits low- and middle-income Americans hardest. Renters see it in higher lease renewals. Families feel it at the grocery store. Workers see their raises disappear before they even reach their bank accounts.

And because the Fed’s money creation and bond-buying funnel disproportionately flows into financial markets, the benefits accrue to those who already hold assets, thereby widening inequality. Meanwhile, political games at agencies like the CFPB, with the Chopra Rule, and harmful state-level interventions (such as interchange fee carveouts and credit card interest rate caps) make credit more expensive and less accessible, compounding the damage.

What Needs to Happen Now

The Fed has one job it can control: the money supply. It can’t reform Congress’s spending addiction, but it can stop enabling it.

Key steps:

• Cap the Fed’s balance sheet at 6% of GDP and commit to steady reductions.
• Maintain the current target interest rate until inflation is well below 2% for a sustained period.
• End mission creep into climate policy, ESG, DEI, and other political causes.
• Full independent audit for transparency until elimination.

These reforms would restore credibility, stabilize prices, and lay the groundwork for deeper changes — including a long-term plan to end the Fed’s monopoly on money.

Bottom Line

The Fed’s oversized balance sheet is still having a greater impact on the economy than the interest rate it sets. Until that intervention unwinds, inflationary pressures will linger — and any premature rate cut will exacerbate the situation. This is a moment for monetary discipline, not political expediency.

​Don't miss my interview on NTD News. Jeffrey Tucker of the Brownstone Institute joined me on the panel to discuss the first 100 days of the Trump administration.

​Watch my interview in NTD News on 1/31/2025.

​Despite cooling inflation, consumer sentiment is still low as its impact continues to weigh on households.

Vance Ginn, president of Ginn Economic Consulting and former chief economist of the Office of Management and Budget, spoke to NTD about the future of the American economy in the next four years.

Here's the post by NTD News: https://www.ntd.com/congress-must-act-to-cut-government-spending-economist_1034926.html