CHARLOTTESVILLE, VA (CVILLE RIGHT NOW) – Inflation may be stabilizing, but the real economic concern ahead is a weakening economy, says Dr. Ed Burton, chief economic analyst and University of Virginia professor. On Morning News, Burton said despite reports suggesting a rise, inflation remains under control. “Inflation was estimated to come in at 0.3 and that’s exactly where it came in… inflation is not really the big issue going forward. It’s potential weakness in the economy,” he said. 

Burton warned that ongoing tariff policies, compounded by a weakening dollar, could severely harm American consumers. “What would happen in Virginia if you raised the sales tax 30%? Well, prices would go up for a while, but the economy would get hit so bad that some prices would actually go down and wouldn’t really create inflation. It would just weaken the economy,” he said, emphasizing that tariffs are essentially a tax on Americans, not foreign entities. He also noted that diminished global trust in U.S. economic leadership, driven by confrontational policies, is eroding interest in American assets, further hurting the dollar. 

Interest rates, often expected to drop in a downturn, may stay elevated due to ballooning federal debt. “We’re not likely to see lower rates, even if the economy weakens… just because of the size of the debt,” Burton cautioned. He voiced support for efforts to cut government spending, referencing past initiatives like Elon Musk’s push for federal efficiency. Without restraint, Burton believes, high borrowing costs and economic stagnation could become the norm. 

Listen to the full conversation here: