Notwithstanding the pre-election issues of open borders, ‘democracy’ and women’s health, disaffection with prices of everyday essentials symbolized by eggs was the major driver of the landslide election victory by the President-Elect and Republican down-ticket candidates.
The price of eggs became the focus of food inflation among voters. Notwithstanding, the reduction in the inflation rate from nine percent in late 2023 to under three percent by November 5th, the electorate rejected the statistics and were motivated by high costs associated with groceries, automobile insurance, rentals, mortgage payments and credit card interest. Despite the fact that inflation has declined, the perception that the economy was mismanaged overruled other considerations, motivating the selection of the top-of-the ticket and members of the House and Senate, even down to the proverbial city dog-catcher.
November 5th has passed, and the trifecta is a reality. The question now is how the economy will fare under the incoming Administration. Deregulation with removal of restraints on mergers and the elimination of onerous “woke” regulations should have a stimulatory effect on the economy. Reduction in government spending, especially in wasteful projects and activities as evidenced by USDA giveaways, should be beneficial in establishing a balance between revenue and expenditure. Adjusting tax rates will benefit both entrepreneurs and corporations with a short-
term benefit to shareholders and ultimately to consumers.
There will however be negative impacts if some pre-election promises are implemented. Imposition of tariffs on imported goods and especially those directed against the People’s Republic of China will be inflationary. It is axiomatic that tariff wars reduce trade and hence U.S. exports. As prices for imported products escalate, domestic producers will increase prices to match those of imported goods. Protectionism also limits innovation and expenditure on research and development. Any observer of economic history will be aware of the effect of the 1930 Smoot-Hawley Tariff Act on exacerbating and extending the Great Depression.
Deportation of illegal immigrants especially those with criminal convictions is justified. It should be recognized that law-abiding foreign workers are necessary, especially for agriculture, given that a proportion of the U.S. population drawing social security and SNAP benefits appear disinclined to take the jobs performed by guest workers. Obviously, the solution is to radically improve immigration legislation and to provide both seasonal and extended-duration visas to workers, preferably with a path to permanent residence as in Canada. Mass deportation would be disruptive and extremely expensive and is fraught with practical problems including undesirable impacts on nations in Central America.
Imposition of tariffs on Mexico could seriously affect agricultural exports since our USMCA partner represents a major importers of corn and soybeans in addition to broiler leg quarters, shell eggs and egg products. The agricultural and industrial structures of the U.S, Canada and Mexico are so integrated that inappropriate and precipitous actions could have severe and far-reaching unintended consequences.
Notwithstanding pre-election rhetoric, it is hoped that economic realities over the coming four years will be tempered by reality and practicality. We look forward to the positive aspects that will benefit the economy. It is anticipated that the more extreme potential negative aspects will be subject to both Executive and Congressional review and restraint.
At the end of the day, voters will have to decide whether they are better off at the 2026 mid-terms and the 2028 general election than they were in 2024. The price of eggs has become an election issue so APHIS had better backtrack on their reluctance to approve regional vaccination to protect egg production and turkey flocks. Politicians will be basing their campaigns on the cost of food and everyday living. The availability and hence price of eggs will be a symbol of the cost of feeding families and will be a determinant of voter satisfaction.