Trump Endorses 18-Cent Gas Tax Suspension as U.S. Gasoline Prices Jump 47%
Updated
Updated · Barron's · May 11
Trump Endorses 18-Cent Gas Tax Suspension as U.S. Gasoline Prices Jump 47%
12 articles · Updated · Barron's · May 11
Trump backed suspending the 18-cent-per-gallon federal gas tax as war-driven fuel costs surge, with Sen. Josh Hawley expected to introduce legislation this week.
A 47% jump in domestic gasoline prices has revived stagflation fears, though the commentary argues the U.S. faces a milder "stagflation lite" rather than a 1970s-style shock.
Inflation could top 4% this summer or fall while growth slips below its 1.8% long-term trend, but unemployment is still expected to remain under 5%.
The author argues tax holidays, price caps and export curbs would worsen shortages and inflation, echoing policy failures from the 1970s.
The broader risk hinges on the Iran war and the Strait of Hormuz: if the conflict drags on, energy prices could climb further and deepen pressure on the U.S. economy.
Will a gas tax holiday truly lower pump prices, or just be absorbed before reaching consumers?
With the Strait of Hormuz closed, can tapping reserves solve an energy crisis experts call the largest in history?