The Myth Busting Economist by Larry Malone
What Goes Up Must Always Come Down
In this column we revisit the saying “What Goes Up Must Always Come Down.” Maybe you first encountered it in science class when the Law of Gravitation was introduced. If a hand grenade or horseshoe is tossed in your direction it will initially ascend but, at some point, descend. The same happens when a right fielder attempts to throw out a runner at home plate—the ball leaves the hand on an ascending path and then descends into the catcher’s mitt. These and millions of other examples are attributable to the Law of Gravitation, which governs the movement of objects on Earth.
While “What Goes Up Must Always Come Down” holds true for objects, the saying is a myth when it comes to inflation in economics. Inflation measures the growth in the overall price level of items purchased by consumers and producers over time. And we have been struggling with rising prices for quite a while.
But before we consider whether these rising prices will eventually decline, we must first ask where our current inflation is coming from.
Inflation normally comes from the natural workings of markets under capitalism. The roots of inflation are found in situations that affect consumers, producers or both.
Consumers face rising prices if their demand outpaces the ability of producers to supply items for them to own and use. This was the case for toilet paper during the COVID pandemic, and it would have been the case for tickets if Elvis had faked his death and suddenly resurfaced to declare that he was going on tour. Rising prices become a broad spectrum problem when the price of everything increases.
Inflation also occurs in markets when the supply of items across the economy is disrupted by shortages. When powerful hurricanes in the Gulf of Mexico made landfall in the past, many coastal states suffered shutdowns in their oil refining facilities. Gulf coast refineries account for 44 percent of the total oil refined in the United States! Such events in the past have led to sudden spikes in the price of gasoline. Diesel and gasoline “lubricate the gears” of our economy by moving people and goods from place to place, so increases in their prices cause inflation by increasing the price of all things.
Inflation can also deliver a double whammy when too much demand and spending combines with too little supply across the economy. These situations are devastating for households and businesses alike.
Now we can return to busting today’s “What Goes Up Must Always Come Down” myth. Worshippers of capitalism believe that we get the best outcomes, and greatest prosperity, if markets are free. The meaning of free, in this case, means NO government interference.
Our current inflation is unusual in that it’s attributable to government interference in the economy. Government meddling in our sacred free markets has come from the decisions and actions of President Donald J. Trump. And unless his interference with our free markets ends, Trumpflation is here to stay.
Trump has enthusiastically pursued tax and spending policies that are inflationary since his inauguration 22 months ago. In an unprecedented use of presidential power, he’s dodged Congressional authorization to create our longest run of inflation since the late 1970s.
The first policies to fuel inflation were the Trump tariffs in the early months of his administration. American consumers and producers pay for these inflationary tariffs. The Joint Economic Committee of Congress estimates that the tariffs cost the average American household an additional $1,745.00 in expenses in 2025 and will add another $2,512.00 this year.
The Big Beautiful Bill, signed into law on July 4, 2025, was a Trump Congressionally authorized inflationary increase in spending and tax cuts that will add over $4 trillion to the National Debt over the next 10 years.
“Operation Epic Fury” commenced, without Congressional authorization, on February 28, 2026. Better known now eight months later as The Iran War, this Trump decision is wreaking havoc on the inflationary front since it has dramatically increased the cost of “lubricating the gears” of the American economy. After all, we haven’t made the items inside our houses, sheds and barns since the early 1800s—they instead must be shipped to where we buy them, burning fuel at every mile.
And now looms the tantalizing possibility of $5,000.00 “Trump Dividend” checks if Republicans retain control of Congress in a few weeks. While those checks are likely to go the way of our Trump Doge and Tariff checks, they would add over $1 trillion to the National Debt, raise interest rates and boost the current inflation rate another 2 percent, bringing it up to 5.4 percent next year!
If the tariffs and war were to end tomorrow, would inflation go away? Prices, with a few exceptions, are unlikely to drop, largely because of the nature of capitalism. There’s a common saying in the business world that’s been borne out after inflationary periods throughout 250 years of American history: “If people will pay it, why take it back?”
What Goes Up Doesn’t Always Come Down, and it looks like Trumpflation is going to stick around for quite some time.
Larry Malone is professor emeritus of economics at Hartwick College.
