1. Blue Ribbon Panel

Imitate the 1983 Greenspan Social Security committee.

https://www.washingtonpost.com/archive/business/1988/03/27/a-blue-ribbon-challenge-to-nations-red-ink/fe86db9f-2abf-49bb-8a1f-1e4c96c285ae/

6-month time limit. A dozen or less bipartisan dignitaries. Retired ambassadors, investors, CEO’s, federal reserve presidents, etc. Make Mitch Daniels the chair.

https://www.theatlantic.com/magazine/archive/2020/04/mitch-daniels-purdue/606772/

Assign 2 projects. One to cut government waste. The other anti-inflation policies. No more than a dozen recommendations in each half. Presented to congress for simple yes/no vote, without major amendments allowed.

2. Spend Less Government Money

Fiscal spending is too expansionary for the current situation. Back off. Reduce infrastructure spending for now, spend it in the next recession. Reduce marginal defense programs that only have political reasons. Cut state government spending by 3%, which is budgeted to increased by 9%.

https://www.nasbo.org/reports-data/fiscal-survey-of-states

https://rollcall.com/2021/10/18/congress-blocks-cuts-to-top-contractors-weapon-budgets/

3. Incentivize Consumers to Save More

Less aggregate demand will lower prices in many markets.

Increase 401(k) limit by $10,000 for 3 years.

Provide federal government match on first 5% of savings for all employees.

https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/2022-irs-401k-contribution-limits.aspx

https://www.tsp.gov/making-contributions/maximize-your-savings/

4. Encourage Corporate Pricing Restraint

Offer corporate income tax incentives for firms to hold prices fixed for 2 years.

Wage and price “controls” are widely criticized. Perhaps a voluntary nudge would work.

5. Add Older Workers to the Labor Supply

Stop all social security fund contributions (taxes) by workers aged 62 and older.

https://www.investopedia.com/articles/personal-finance/060515/when-do-i-stop-paying-social-security-tax.asp

Eliminate the “clawback” of social security benefits to retirees who do choose to work.

https://money.usnews.com/money/retirement/social-security/articles/what-happens-if-you-work-while-receiving-social-security

Tweak labor laws to fight age discrimination.

Increasing employment for older workers with effective protections against employment discrimination

6. Increase Supply of Legal Immigrants

https://www.cnn.com/2022/01/11/economy/chamber-of-commerce-inflation/index.html

https://www.businessinsider.com/immigration-inflation-labor-shortage-chamber-commerce-suzanne-clark-jobs-work-2022-1

7. Eliminate Hidden Tax of Tariffs and Trade Regulation

Unilaterally eliminate all tariffs with Europe, Central America, South America, Japan, South Korea, New Zealand, India. Negotiate with China.

https://finance.yahoo.com/news/one-way-biden-could-cut-inflation-131832592.html

https://www.cnbc.com/2021/11/30/removing-us-china-trade-tariffs-would-ease-inflation-jacob-lew.html

To tame inflation, Biden should cut tariffs

8. Windfall Profits Taxes

https://www.cbsnews.com/news/biden-tax-how-billionaire-minimum-income-tax-works-cbs-news-explains/

https://rollcall.com/2022/03/24/windfall-profits-tax-consumer-rebate-options-under-discussion/

NEWS: Sanders Introduces Legislation to Reinstate the WWII Windfall Profit Tax to Combat Rising Inequality, Inflation, and Corporate Profiteering

https://www.bloombergquint.com/gadfly/to-fight-inflation-biden-should-tax-the-rich-shrink-the-deficit

9. Cut Transportation Costs

Tax incentive for more truck drivers.

https://www.truckinginfo.com/10166531/new-bill-aims-to-reduce-truck-driver-tax-liabilities

Open ocean shipping to competition.

What is the Jones Act?

Open trucking to Mexico based carriers.

Mexico-based carriers can still operate in United States under USMCA

10. Negotiate Drug Prices, Allow Interstate Health Insurer Competition

https://hbr.org/2021/10/the-u-s-can-lower-drug-prices-without-sacrificing-innovation

https://www.sidley.com/en/insights/newsupdates/2021/11/us-looks-to-introduce-europeanstyle-drug-price-controls

https://www.freep.com/story/news/nation/2014/09/05/dems-try-gop-idea-on-health-care-put-states-in-charge-of-cost-control/15106115/

https://www.marketwatch.com/story/six-ways-republicans-can-reduce-health-care-costs-in-their-new-plan-2017-03-11

https://www.manhattan-institute.org/reforming-health-insurance-across-states

https://www.commonwealthfund.org/blog/2017/selling-health-insurance-across-state-lines-unlikely-lower-costs-or-improve-choice

11. Increase the Supply of Housing

Increase immigration to improve labor supply. Cut tariffs to reduce supplies costs. Lean on local regulators to reduce zoning restraints and one size fits all building codes. Strategically require a higher share of affordable housing and multifamily permits annually in each metropolitan region. Phase-out the mortgage interest tax deduction for second homes.

https://www.bloomberg.com/news/articles/2022-02-04/in-sizzling-u-s-housing-market-normal-is-a-long-way-off

https://www.whitehouse.gov/cea/written-materials/2021/09/01/alleviating-supply-constraints-in-the-housing-market/

Dysfunctional policies have broken America’s housing supply chain

https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/2022-irs-401k-contribution-limits.aspx

12. Cut Energy Prices

Loosen regulations for 5 years to encourage increased “all of the above supplies” energy through drilling, coal, oil and nuclear. Suspend federal gas tax for 3 years. Negotiate oil price minimums/maximums between US/Europe/Japan and OPEC.

https://www.reuters.com/world/us/bidens-menu-options-high-gasoline-prices-is-not-appetizing-2022-03-23/

https://www.cbsnews.com/news/gas-prices-inflation-us-president-cbs-news-explains/

https://nymag.com/intelligencer/2022/03/heres-how-biden-can-lower-gas-prices.html

Summary

Reducing inflation is a complicated policy area. The solutions proposed by “experts” are rarely politically appealing. Competing political parties hesitate to provide “wins” to the other. However, 8% inflation after a 2-year pandemic while the US faces Russian war actions is a “national emergency”, worthy of an FDR like approach to “try a few things”. It is an opportunity to overcome individual industry opposition to things that make sense for the country. It is an opportunity to try some left and right solutions.