Trump’s latest bad idea won’t save GOP from 'huge defeat': Nobel economist

With diesel prices continuing to soar and the United States' 2026 midterms less than one and one-half months away, President Donald Trump is proposing an export ban for U.S. diesel. But the proposal is getting a cold response from some conservative Republicans, including outgoing Sen. John Cornyn (R-Texas) — who dismissed it as a "gimmick." And liberal economist Paul Krugman, in a biting Substack column, attacks Trump's proposal as a "really bad idea" that won't save Republicans from a "huge defeat" in the midterms.

"There's a strong whiff of desperation coming off the Republican Party these days, and it smells a lot like diesel fumes," Krugman argues in his column. "All indications are that the GOP is headed for a huge defeat in the midterms, and soaring prices of fuel — especially diesel — are a significant factor in the party's dim prospects. Now, Trump is considering an export ban of American diesel in order to temporarily reduce domestic diesel prices. As of this morning, it's unclear whether this will actually happen. But I think a diesel export ban is highly likely, and not just because it would be one of the few Hail Mary plays left for an epically corrupt president who must greatly fear the prospect of facing Democrats with subpoena power and criminal referrals."

Krugman adds, "Beyond that, a sudden ban on diesel exports would, in effect, be a broken promise — a de facto breach of multiple contracts."

Trump, Krugman notes, aggressively campaigned on fossil fuel production, and the export ban would be a "breach of contract" with the fossil fuel companies that supported him.

"Jared Bernstein has a really clear explanation of why such a ban would do little to help most Americans with affordability problems," Krugman explains. "Much of it comes down to regional differences. U.S. diesel exports come from the Gulf Coast, and cutting off those exports would indeed temporarily reduce diesel prices in and around Texas, while driving prices up in the rest of the world. But in this case, 'the rest of the world' includes much of the United States. Both the Northeast and the West Coast buy much of their diesel — and heating oil, which is a closely related commodity — from other countries. So a ban on U.S. exports, by driving up world prices, would actually make energy more expensive in some parts of the country."

The world, according to Krugman, is seeing a "a competition between two visions of the world's energy future." One promotes "electrification of cars and much else, powered by sun and wind," while the other — which Trump embraces — favors "continuing reliance on fossil fuels."

"Now, the world knows that we can't, in fact, be trusted as an energy supplier — that we may suddenly cut off fossil fuel exports whenever doing so might yield even temporary domestic political advantage," Krugman warns. "So, a diesel export ban would probably do little to assuage U.S. concerns about affordability. It would create uncertainty that deters business investment, in energy and other industries. And it would further weaken America's hand in its geopolitical rivalry with China over energy."

Krugman adds, "In short, a ban would be a really bad idea. Which is why it's probably going to happen."