What Happens If Trump Wins Again? Economic & Social Outlook

Donald Trump is currently serving his second term as the 47th US President, having won the 2024 election. His administration's economic and social policies are already in motion, and their outlook can be summarized as follows:

Economic Outlook:

• Tariffs and Trade Wars: A central pillar of the current administration's economic policy is a focus on large-scale protective tariffs. Universal tariffs of 10% on nearly all countries have been imposed, with higher rates on many specific trading partners, including significant escalation of trade wars with China, Canada, and Mexico. The administration views trade deficits as harmful and aims to promote domestic manufacturing and self-sufficiency.

  • Impact: Economists generally criticize tariffs as taxes on consumers and businesses, leading to higher prices for imported goods. Projections suggest these tariffs could significantly reduce long-run GDP and wages, with some estimates indicating a substantial lifetime loss for middle-income households. While the administration argues tariffs will boost domestic jobs and revenue, their effectiveness in achieving these goals is debated.

• Taxation and Deregulation: The administration is pursuing lower taxation and deregulation. Plans include extending and expanding the 2017 tax cuts, potentially reducing corporate tax rates further for domestic manufacturers, and removing taxes on tips, overtime, and Social Security benefits. Deregulatory efforts have been significant, impacting various federal agencies.

• Budget and Spending: A new Department of Government Efficiency (DOGE) has been established to cut federal spending, leading to mass layoffs of federal employees and attempts to dismantle agencies. A temporary pause on federal grants and loans was also implemented. The administration has also proposed a "Big Beautiful Bill" which, if enacted, could further widen the US structural fiscal imbalance and debt.

• Stock Market and Investment: The announcement of large tariffs in April 2025 led to a stock market crash, although some controversial policies have been softened in response to market reactions. US business and financial investment may decline due to policy and governing shifts.

• Sovereign Wealth Fund: The administration has signed an executive order directing the creation of a US sovereign wealth fund, despite the US not having budgetary surpluses, which typically fund such initiatives.

Social Outlook:

• Immigration: The administration is pursuing aggressive immigration policies, including aiming for large-scale deportations, stricter work visa requirements, reduced legal immigration quotas, and the establishment of detention facilities. Efforts to end birthright citizenship and expand the "Muslim ban" are also being pursued. These policies have created widespread fear and uncertainty in immigrant communities and have faced legal challenges.

• Healthcare: Significant changes to healthcare are underway. The administration has signaled intentions to modify or replace the Affordable Care Act (ACA), potentially leading to millions becoming uninsured and a return of restrictions on pre-existing conditions. Proposed reforms to Medicare and Medicaid, including spending caps and work requirements, could reduce coverage. Policies leaning "pro-life" are also being promoted, including attempts to remove protections for emergency abortion care and support for "conscience exceptions" for medical professionals.

• Public Health and Science: There have been significant cuts and restructuring in federal public health and science agencies, including the CDC, NIH, and USAID. This has led to staff reductions, funding cuts for research, and the suspension of some official publications. Concerns have been raised about the potential long-term costs to innovation, productivity, and the ability to respond to future health threats.

• Freedom of Speech and Targeting of Opponents: Concerns have been raised about the administration's perceived influence on cultural narratives through social media platforms and a focus on embedding ultraconservative ideas. There are also reports of government targeting of political opponents and civil society.

• Judicial Appointments and Rule of Law: The administration's actions have led to increased executive-judicial conflict, with lower courts and the Supreme Court frequently intervening. The integrity of the rules-based international order is also seen as being damaged due to the administration's approach to international law and multilateral institutions.

Overall, the current Trump administration's economic and social policies are marked by a strong emphasis on economic nationalism, deregulation, and a conservative social agenda, leading to significant shifts in domestic and international relations, with a predicted negative impact on long-term economic growth and social cohesion.