Victor Davis Hanson: Energy, Tax Cuts, and Deregulation Could Supercharge 2026’s Economy

Jan 7, 2026

Victor Davis Hanson explores the recipe for economic success, highlighting the importance of productivity, foreign investment, and deregulation. He predicts a significant economic boom in 2026, fueled by rising oil production and innovative technologies like AI. Strong Q3 growth under Trump is noted, contrasting with past policies. With expectations of substantial tax cuts and a wave of foreign investment, Hanson believes the landscape will be ripe for prosperity. However, he advises staying alert for unexpected twists ahead.

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INSIGHT

Core Drivers Of An Economic Boom

Victor Davis Hanson highlights metrics that define booms: productivity, foreign investment, reasonable interest rates, deregulation, tax cuts, and energy production.
He frames these as the core drivers policymakers should aim for to create sustained growth.

INSIGHT

Unexpected Q3 Growth Narrative

Hanson points out media surprise at strong Q3 growth and uses "unexpectedly" to describe coverage contrast.
He argues the economy performed well despite prior warnings of recession and inflation under Trump's policies.

ADVICE

Emphasize Economic Wins Now

Hanson urges the Trump administration to emphasize Q3 gains when contrasting with the Biden years and preparing voters for 2026.
He advises stressing citizen job gains and reduced unemployment as political and economic selling points.

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Economic booms are usually defined by “greater productivity,” increased foreign investment, “reasonable” interest rates, “energy production,” and “plentiful deregulation and tax cuts.” But will any of this happen in 2026?

Hanson predicts we’ll “see an economic bonanza” in 2026 as “there's going to be more oil,” “ new technologies,” and “all sorts of tax cuts” and “more deregulation than we've ever seen” in the Big Beautiful Bill on today’s episode of “Victor Davis Hanson: In a Few Words.”

“ Add it all up: We've had an unexpectedly—unexpectedly, unexpectedly—good third quarter. I imagine the fourth quarter might be just as good if it were not for the government shutdown—the longest in history—that occurred in the fourth quarter, but we'll see. But more importantly: more foreign investment, more tax cuts, more deregulation, more energy development, lower interest, and I think you're gonna see an economic bonanza.”

00:00 Introduction: What Makes an Economy Boom?

00:34 Unexpected Economic Trends

01:18 Analyzing Trump’s Third Quarter Growth

02:56 Future Economic Predictions for 2026

04:43 Conclusion: Preparing for the Unexpected

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