The President-elect of the United States, Donald Trump, is set to inherit the world's leading economy. America has given us an unprecedented and powerful mandate. On the campaign trail, he offered many ideas for the future. Other countries are going to finally, after 75 years, pay us back for all that we've done for the world. We will drill, baby, drill. In reality, President Trump has quite a great deal of discretion on how he acts, especially with a Republican Congress. I don't think this is just going to be a magic wish list of everything that Trump wants. So what's in store now that Americans have cast their vote? Many Americans voted with their wallets in this election. Consumer prices have increased over 20% since February 2020. I bet most Americans under the age of 45 or 50 have never experienced inflation until this last episode, and I don't

think they realized that would basically take a recession, you know, even a depression in the United States to restore the price level to what it was in 2019. Managing prices in the United States is typically left to the Federal Reserve. The Fed's policies affect the cost of borrowing money, which in turn influences how likely you are to get a job or afford rent. President Trump may look for more control there. I made a lot of money. I was very successful, and I think I have a better instinct than, in many cases, people that would be on the Federal Reserve or the chairman. To politicize the central bank is generally associated with higher rates of inflation, and it ends up hurting the US and actually ends up benefiting the rest of the world because you essentially get capital outflow from the United States. Trump getting involved with the Fed will certainly spook people and investors to a certain extent.

Wouldn't surprise me if you see the replacement in 2026 when Powell's term as Chair is up. Trump has other tools to help Americans out financially. One idea called for leaving about 93 million Americans off the hook for at least a portion of their federal income taxes. I think when he proposed eliminating the income tax and just having tariffs, there was sort of like an oh my gosh moment for everyone. We've seen this with Trump before, right? He throws out this really bold idea. But then by the time it actually starts being implemented, by the time he's talked with more people about it, you see it kind of transform. Americans received a tax cut during Trump's first term, but that tax cut is set to expire in 2025. I think Republicans pretty much across the board do want to see a lot of what was in that 2017 tax package.

expanded. To pay for those cuts, Congress will have to shuffle things around. They may consider ending the tax-exempt status for municipal bonds or dial back health care spending. Without cuts, it could add to the national debt. When you saw this passed in 2017, it really did add to the deficit, and there is a chance that it could do so again. By 2030, federal debt could amount to over 125% of gross domestic product, or GDP, which is a measure of the country's entire economic output. Another option is to increase economic growth by loosening regulations that impact industries like oil production, airlines, banking, and tech. The deregulatory process is something that probably will be pointed to as the most potential influence. You know, the economy is so many things in so many places that's open to so many foreign influences that the extent to which Trump alone and his White House alone can

shape that, I think, is often overstated. Trump has also called for tariffs of 10 to 20% on imports arriving in the United States, and a higher tariff on Chinese goods. The higher the tariff, the more likely it is that the company will come into the United States and build a factory in the United States, so it doesn't have to pay the tariff. The goal of those tariffs is to generate revenue and bring industrial jobs back to the United States. Ironically, this would not promote a revitalization of the industrial sector. Those sorts of things will raise the prices of all kinds of industrial inputs. And so that will make it harder to produce industrial products in the United States. It will also tend to push down investment. Those tariffs could also lead to higher prices for shoppers. The impact on different levels of household income is pretty dramatic. And you know, these kinds of taxes, tariff taxes

are extraordinarily regressive and hurt lowest-income families the most. The tariff policy is expected to weigh on both small and big businesses. The President-elect's promise to deport undocumented people could have a far-reaching economic impact. On day one, I will launch the largest deportation program in American history. There's an estimated 8.3 million undocumented workers in the United States right now. If you pull them, any substantial number of them out, it will have large negative effects on the US economy. If all undocumented workers were expelled, employment would fall below its baseline trend by 2028. Economic growth would decline too. Agriculture and construction would be particularly hard hit. Food prices in the United States would go up substantially, and it would substantially disrupt the housing market. They provide a reservoir of relatively low-cost labor that is a kind of lubricant to how the economy works.

What A U.S. Economy Under Trump Will Look Like

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