Since returning to the White House, President Donald Trump has adopted a confrontational economic strategy aimed at addressing persistently high prices. This approach includes regulatory threats against private businesses and punitive measures against policymakers, which have raised questions about their potential to exacerbate existing economic challenges.

Trump's interventions have become increasingly apparent in recent weeks. He has intensified his criticism of the Federal Reserve and initiated an investigation into its chair, aiming to pressure the central bank into rapidly lowering interest rates. Additionally, he has targeted various sectors, including defense contractors, oil companies, major banks, and real estate investors, whose practices he perceives as misaligned with his political objectives.

Framing these actions as part of his electoral mandate, Trump claims they are intended to reduce regulation, cut taxes, reshape global trade, and stimulate economic growth in a nation still recovering from the pandemic's economic impact. However, both policymakers and economists, including some who support Trump, have expressed concerns about the unpredictability and risks associated with his reliance on punitive measures. They argue that such tactics could undermine the foundational principles that have contributed to the United States' economic reputation globally.

In a related development, Trump has proposed a cap on credit card interest rates at ten percent, which is receiving significant pushback from Republican lawmakers in both the House and Senate. These lawmakers argue that such a cap could severely limit credit access for many Americans. Trump has urged lenders to implement this cap by January 20, warning of potential consequences for those who do not comply.

In his efforts to address affordability issues, Trump has made demands of independent agencies and private businesses, including pressuring Federal Reserve Chairman Jerome Powell to lower interest rates and urging corporations to refrain from purchasing single-family homes. Recently, he reached out to Senator Elizabeth Warren to discuss the interest rate cap and her housing reform bill, which was described by a White House official as a productive conversation.

However, Republican leadership has expressed skepticism regarding the feasibility of Trump's proposal. House Speaker Mike Johnson indicated that the president may not have fully considered the implications of such a cap, emphasizing the need for legislative consensus and caution against unintended consequences. He noted that experts have suggested that credit card companies might cease lending altogether if interest rates are capped. Senate Majority Leader John Thune echoed these concerns, stating that the cap could limit access to credit and potentially transform credit cards into debit cards, a scenario he does not support.

Trump's initial announcement of the interest rate cap came with claims that lenders are exploiting consumers. He has stated that the cap should be enforced for one year, starting January 20, and has threatened severe repercussions for lenders who do not comply, despite lacking legal authority to impose such a cap. He characterized credit card companies as having taken advantage of the public.