On the surface, Donald Trump is disinterested in the nation’s abiding cost-of-living concerns. Everything is fine, the president insists, loudly if he has to. His shrinking economic approval ratings are a lie, the term “affordability” is a hoax, and the news, you see, is fake.
Behind the scenes, the White House is desperate for any good story to tell that corresponds to Trump’s campaign promise to lower prices, with the emphasis on “story.” Lowering or even moderating prices is a tall order for this administration, because the tension between doing anything beneficial for the public and how that would damage profits for big corporations and their $10,000-an-hour lobbyists is simply too great. A story is simple: You feed the rubes with something that sounds good, but which in the end will fizzle out or not add up to anything of value.
What’s amusing is that when the Trump administration goes looking for these stories, they come crawling over to the best ideas of the Biden administration, the one deemed the worst in American history. Sadly enough, if they bothered to follow through, the ideas could actually work.
For instance, the administration continues to tout deals with drug companies for its direct-to-consumer cash-only website for medications, which will not lower drug prices for the vast majority of Americans who get prescription drugs through insurance, and will in fact entrench the higher prices by keeping them in place for insurance transactions. Most of the “cheaper” drugs were near the end of patent protection and would have seen their prices driven down by generic competition anyway. It’s a fake solution.
The better solution for high drug prices is to use the power of the government to negotiate the price paid for our many public-health programs. You can do this for Medicaid, but prices are already mandated to be low by law, and patients already pay no more than a few dollars for medications in the program. Even if states are saving a little money on the list price, it won’t translate to patient affordability.
Medicare is a more broad-based program with a sicker population; lowering list prices there could make a real difference and even cross over into prices for everyone else. That would be, you know, the Democratic program passed in 2022 with the Inflation Reduction Act. And while those prices only begin to kick in next year because of political malpractice, they are rolling out under Trump. In fact, the administration announced price cuts last month for the next round of 15 drugs that will take effect in 2027, reducing list prices between 38 and 85 percent.
The only thing Trump has done other than follow the rules for Medicare price negotiation is exempt some of the most high-cost drugs from the program. But since people don’t follow political debates closely, they will associate the lower prices on ten drugs in Medicare next year, and more in future years, with Trump. Unfortunately for him, he has stepped on this message with his huckster website that won’t do anything for most people. Expanding the Biden negotiations would have been the move here.
Separate from this, there’s been a minor resurgence from the Federal Trade Commission, or at least from their press release shop. This month, the FTC announced it would begin to make rules prohibiting certain hidden junk fees in rental housing. It quietly reopened the “click to cancel” rule that would make ending a subscription-based service as easy to do as signing up for it. And in the wake of a terrific investigation into Instacart’s use of AI-fueled pricing experiments, where shoppers ordering the same items from the same place at the same time were getting price variances of up to 23 percent, the FTC opened an investigation into the company, according to Reuters. (Instacart has now said it will end its pricing tests voluntarily.) The agency even sued to block a merger, a rollup in building materials for housing.
All of these initiatives would fit comfortably in Lina Khan’s FTC, and all have to do with lowering prices by protecting consumers from junk fees, deceptive practices, corporate consolidation, and surveillance pricing. As Sam Levine, the former FTC Bureau of Consumer Protection director, pointed out, the hidden housing fee rulemaking reinforces the whole idea that the agency can make rules, a dormant procedure that was resurrected during Khan’s tenure. (This is even true in the prescription drug context. One of the price cuts announced for Trump’s direct-to-consumer website is GSK’s popular inhaler Advair Diskus, which will be available for $89 a month. But last year, Khan broke up a patent scam on inhalers and got GSK to lower out-of-pocket costs for all its asthma medications to $35 a month, which some quick math shows is lower than $89.)
Before we get excited about a new era of consumer protection, we should stress that these are all at the infancy stage. The rulemakings don’t have to necessarily go anywhere, investigations could easily stall or be dropped, and we’ve seen merger challenges reversed in this administration once the men in nice suits with money get involved. We’re seeing it right now with the competition for who will buy Warner Bros. Everyone knows that consolidating studios in Hollywood will raise prices, but both suitors in the bidding war (Netflix and Paramount) hired lobbyists from Ballard Partners, Attorney General Pam Bondi’s old firm.
I think I can piece together what happened here. After the election wipeout, the White House got on the phone to nominally independent agencies it now controls, thanks to the unitary executive theory, and told them to make it look like they were doing something to lower prices. FTC chair Andrew Ferguson, who badly wants a federal judgeship, enthusiastically complied by throwing out a bunch of press releases and leaking word of investigations. As soon as these initiatives start messing with corporate profits, you probably won’t hear much about them.
But what’s interesting is the model the Trump administration is following for what to do in an affordability crisis: pretend to be Lina Khan. The low-hanging fruit to stop the overwhelming feeling people have that they’re being ripped off in this economy—a not-inconsiderable element of the overall anger and frustration with high prices—is best countered by actually standing up to the corporations scamming the public.
Expecting Donald Trump to actually stop a scam is like expecting Donald Trump to follow the law. Just look at Trump’s pardon list, or the inert Consumer Financial Protection Bureau, for some guidance here. But his lizard brain understands that his predecessor had some pretty good ideas to prevent public ripoffs. If only he cared enough to use them.