Some of the Golden Points of the President's Golden Era

Taking a break from the things I could say about some of Trump’s lies and distortions in his State of the Disunion address, I want to focus on three particularly smart and positive things the would-be king is ordering up to help the little guy in 2026 in order to clamp down on the super-bigs that devour to much of the American pie.

Big Real Estate Out

When my wife and I sold our farm in order to downsize for retirement, we got hit by those rapidly rising home prices on the other side of the sale because the sale took months to close. A big part of that outrageous escalation in prices was driven by big Real Estate owners sucking up single-family homes in order to monopolize local rental markets as much as possible.

My wife and I and others would bid $30-$50,000 over asking with no contingencies just to have a chance at actually locking in a purchase, but companies like Blackstone would come along time and again and say, “Just add $50,000 to whatever they bid.” They had the massive money to easily do that, and they were more interested in using their size to monopolize rental markets for the future than in owning a home anyone could afford to live in at those prices.

It was happening all over the nation. Trump has been saying this needs to end, and he put that in his address on Tuesday night.

Trump is pushing Congress to pass legislation that would block landlords with 100 or more single-family rental homes from buying additional existing single-family homes. The idea is to prevent a surge of concentrated buying in a handful of markets that would distort prices further. These landlords could still build their own single-family rentals, or buy build-to-rent developments from builders – thereby adding to the housing stock. But they could no longer buy existing homes. (Wolf Street)

As Wolf Richter points out, it is probably too little, too late to do a lot of good, but it’s a move in the right direction. It may make a difference during the next housing crash when big firms would likely swoop in to snarf up fire-sale bargains in order to become dominant landlords. If Trump makes it so they can’t, that will leave more room for the little guy who has been long priced out of the market to benefit from the bargains in the next bust.

Big Pharma Down

This has been a no-brainer for two decades, so why didn’t anyone think of it until Trump came along. For years, Big Pharma has been charging prices to Americans that are outrageously higher than what they charge to people in any other nation. They’ve argued this is essential to cover all their development costs and their legal liabilities.

Trump has said, “No more. You’re going to bring your pricer Americans down to match the lowest price you give to anyone in the world.” This policy, if it is carried out will force Big Pharma to spread their major costs out over everyone or, at least, hit other nations harder than us; and if that means some people in some countries cannot afford the drugs, tough.

Big Pharma benefits from superior economics in America and a highly educated labor pool for its R&D, yet it charges America its worst rates. No more. Find a way to distribute all your costs more equitably. Having to charge all of America the lowest rate you charge to any nation, should balance that out quickly.

Big AI Powers Up

Trump also came up with an obvious solution to a rapidly developing AI problem. The absolutely massive power requirements have been forcing electricity rates through the roofs in communities AI developers moved into in order to get cheap electricity and other benefits. Trump effectively said in his State of the Disunion address, “Power up at your own expense entirely. You will have to build your entire electrical generation needs.”

Why not? What better way to assess economically whether AI makes sense than to make sure it pays 100% for its cost of development and operation. Why should billionaire electric rates wind up being subsidized by much higher rates for the rest of a small community. If AI developers cannot find a way to make that work, AI should not be built. Let’s just hope they remain environmentally sensible and don’t offer an easy path to environmental ruin just to get those plants built because it obviously does not make economic sense.

One needs to also make sure they are paying 100% of the actual cost of preventing environmental damage where they are located since big electrical plants can cause damage and pollution. (I say “actual,” meaning let’s get rid of theoretical costs and built-in green taxation via fees, etc. out of it; but the environment around the new plants should remain, at least, as healthy as it was before they came once they are up and operating.) Clean up your own mess as you go, or get lost.

Government econnoissance reports outed

Finally, let me note that, when Trump’s head of economic reporting at the Bureau of Lying Statistics makes a big public statement, protesting that his Jobs and CPI reports “are not being politically manipulated,” then you KNOW nearly everyone is pointing out how politically manipulated those economic reports have obviously become.

Methinks he doth protest too much. Always bad, the BLS reports have simply become too bad to even use, so I now rely much more on alternative data, as I’ve explained in recent months. I’m glad to see people are turning up the pressure on the BLS by pointing out how deeply flawed the reports have become to such extent that the head of the bureau now has his back up trying to defend his bureau’s vain numbers.

Maybe Fox will give the new bureau head (hired to replace the one fired by Trump for being too negative when she was actually way too positive) a free ride by interviewing him with softball questions about on what a great job he is doing. The missing data, of course, provides room for some of the president’s most obvious fake claims in his speech about inflation falling and the economy soaring like never before.

“So much winning.” But the wins are easy when the score board is faked and fully controlled and refereed by the home team.

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